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	FINANCIAL HIGHLIGHTS	PLN k		EUR k
		31.12.2025	*31.12.2024 represented**	31.12.2025	*31.12.2024 represented**
Consolidated financial statements of Santander Bank Polska Group
I	Net interest income	12 702 826	12 270 414	2 997 929	2 850 800
II	Net fee and commission income	2 948 517	2 784 632	695 864	646 957
III	Profit before tax	8 259 890	7 234 098	1 949 375	1 680 707
IV	Net profit attributable to owners of the parent entity	6 478 814	5 212 731	1 529 032	1 211 080
V	Net profit attributable to owners of the parent entity from continuing operations	6 462 914	5 283 849	1 525 279	1 227 603
VI	Net profit(loss) attributable to owners of the parent entity from discontinued operations	15 900	(71 118)	3 752	(16 523)
VIII	Profit/loss of the period attributable to non-controlling interests	286 031	32 066	67 505	7 450
IX	Total net cash flows	1 501 233	(5 571 687)	354 298	(1 294 477)
X	Earnings per ordinary share in PLN/EUR	63,40	51,01	14,96	11,85
XI	Diluted earnings per ordinary share in PLN/EUR	63,40	51,01	14,96	11,85
XII	Earnings per ordinary share from continuing operations in PLN/EUR	63,24	51,71	14,92	12,01
XIII	Diluted earnings per ordinary share from continuing operations in PLN/EUR	63,24	51,71	14,92	12,01
XIV	Total assets	308 150 077	304 373 920	72 905 595	71 231 903
XV	Deposits from banks	2 847 280	5 148 660	673 641	1 204 929
XVI	Deposits from customers	230 142 564	232 028 762	54 449 704	54 301 138
XVII	Total liabilities	272 644 851	269 932 734	64 505 371	63 171 714
XVIII	Total equity	35 505 226	34 441 186	8 400 224	8 060 189
XIX	Non-controlling interests	79 554	1 913 719	18 822	447 863
XX	Number of shares	102 189 314	102 189 314
XXI	Net book value per share in PLN/EUR	347,45	337,03	82,20	78,87
XXII	Capital ratio	20,00%	17,99%**
XXIII	Declared or paid dividend per share in PLN/EUR	46,37***	44,63	10,94	10,37

*Data represented following the separation of the discontinued operations; details are presented in Note 48.

**The data includes profits included in own funds, taking into account the applicable EBA guidelines.

***Detailed information are described in note 56.

The following rates were applied to determine the key EUR amounts for selected financial statements line items:

· for balance sheet items – average NBP exchange rate as at 31.12.2025: EUR 1 = PLN 4,2267 and as at 31.12.2024: EUR 1 = PLN 4,2730

· for profit and loss items – as at 31.12.2025 - the rate is calculated as the average of NBP exchange rates prevailing as at the last day of each month in 2025: EUR 1 = 4,2372 PLN; as at 31.12.2024 - the rate is calculated as the average of NBP exchange rates prevailing as at the last day of each month in 2024: EUR 1 = PLN 4,3042

As at 31.12.2025, FX denominated balance sheet positions were converted into PLN in line with the NBP FX table no. 251/A/NBP/2025 dd. 31.12.2025.

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I. Consolidated income statement66

II. Consolidated statement of comprehensive income77

III. Consolidated statement of financial position88

IV. Consolidated statement of changes in equity99

V. Consolidated statement of cash flows1010

VI. Additional notes to consolidated financial statements1212

1. General information about issuer1212

2. Basis of preparation of consolidated financial statements1414

3. Operating segments reporting4141

4. Risk management4747

5. Capital management7574

6. Net interest income7978

7. Net fee and commission income8079

8. Dividend income8180

9. Net trading income and revaluation8180

10. Gains (losses) from other financial securities8180

11. Other operating income8281

12. Impairment allowances for expected credit losses8281

13. Employee costs8382

14. General and administrative expenses8382

15. Other operating expenses8483

16. Corporate income tax8483

17. Earnings per share8584

18. Cash and cash equivalents8584

19. Loans and advances to banks8685

20. Financial assets and liabilities held for trading8786

21. Hedging derivatives8887

22. Loans and advances to customers8988

23. Securitisation of assets9998

24. Investment securities10099

25. Investments in associates101100

26. Intangible assets103102

27. Goodwill104103

28. Property, plant and equipment105104

29. Right of use assets107106

30. Deferred tax assets108107

31. Other assets110109

32. Deposits from banks111110

33. Deposits from customers111110

34. Subordinated liabilities112111

35. Debt securities in issue113112

36. Provisions for financial liabilities and guarantees granted114113

37. Other provisions115114

38. Other liabilities116115

39. Share capital117116

40. Other reserve capital118117

41. Revaluation reserve119118

42. Non - controlling interests120119

43. Hedge accounting121120

44. Sale and reverse sale and repurchase agreements130129

45. Offsetting financial assets and financial liabilities131130

46. Fair value132131

47. Legal risk connected with CHF mortgage loans137136

48. Discontinued operations142141

49. Contingent liabilities and litigation and claims146144

50. Assets and liabilities pledged as collateral149146

51. Information about leases149147

52. Related parties151149

53. Acquisitions and disposals of investments in subsidiaries and associate155153

54. Employee benefits155153

55. Share based incentive scheme156154

56. Dividend per share158156

57. Events which occurred subsequently to the end of the reporting period159157

I. Consolidated income statement

	for the period:	1.01.2025- 31.12.2025	1.01.2024- 31.12.2024* represented
Interest income and income similar to interest		17 168 196	16 628 200
Interest income on financial assets measured at amortised cost		14 559 050	14 032 222
Interest income on financial assets measured at fair value through other comprehensive income		1 849 712	1 876 743
Income similar to interest on financial assets measured at fair value through profit or loss		102 593	54 536
Income similar to interest on finance leases		656 841	664 699
Interest expense		(4 465 370)	(4 357 786)
Net interest income	Note 6	12 702 826	12 270 414
Fee and commission income		3 630 172	3 371 267
Fee and commission expense		(681 655)	(586 635)
Net fee and commission income	Note 7	2 948 517	2 784 632
Dividend income	Note 8	15 901	15 668
Net trading income and revaluation	Note 9	266 603	194 877
Gains (losses) from other financial securities	Note 10	11 123	23 419
Gain/loss on derecognition of financial instruments measured at amortised cost	Note 47	(46 940)	(65 278)
Other operating income	Note 11	123 692	114 066
Allowances for expected credit losses	Note 12	(585 898)	(723 905)
Cost of legal risk associated with foreign currency mortgage loans	Note 47	(1 596 631)	(2 252 561)
Operating expenses incl.:		(4 857 186)	(4 451 546)
-Staff, operating expenses and management costs	Note 13,14	(4 126 538)	(3 772 043)
-Amortisation of property, plant and equipment and intangible assets		(456 891)	(401 768)
-Amortisation of right of use assets		(141 836)	(140 225)
-Other operating expenses	Note 15	(131 921)	(137 510)
Share in net profits (loss) of entities accounted for by the equity method		114 457	102 297
Tax on financial institutions		(836 574)	(777 985)
Profit before tax		8 259 890	7 234 098
Corporate income tax	Note 16	(1 726 776)	(1 893 772)
Net profit for the period from continuing operations		6 533 114	5 340 326
Profit/(loss) for the period from discontinued operations	Note 48	231 731	(95 529)
Profit for the period		6 764 845	5 244 797
Profit/(loss) for the period attributable to:
- owners of the parent entity		6 478 814	5 212 731
- non-controlling interests		286 031	32 066
Profit/(loss) for the period attributable to owners of the parent entity from:
- continuing operations		6 462 914	5 283 849
- discontinued operations		15 900	(71 118)
Profit/(loss) for the period attributable to owners of the parent entity		6 478 814	5 212 731
Net earnings per share from continuing operations	Note 17
Basic earnings per share (PLN/share)		63,24	51,71
Diluted earnings per share (PLN/share)		63,24	51,71
Net earnings per share
Basic earnings per share (PLN/share)		63,40	51,01
Diluted earnings per share (PLN/share)		63,40	51,01

* Data represented following the separation of the discontinued operations; details are presented in Note 48

II. Consolidated statement of comprehensive income

	for the period:	1.01.2025-31.12.2025	1.01.2024-31.12.2024
Consolidated net profit for the period		6 764 845	5 244 797
Items that will be reclassified subsequently to profit or loss:		1 204 959	(75 025)
Revaluation and sales of debt financial assets measured at fair value through other comprehensive income, gross	Note 24,41	689 964	505 776
Deferred tax		(129 587)	(96 097)
Revaluation of cash flow hedging instruments, gross	Note 41,50	858 009	(598 400)
Deferred tax		(213 427)	113 696
Items that will not be reclassified subsequently to profit or loss:		4 076	154 312
Revaluation of equity financial assets measured at fair value through other comprehensive income, gross	Note 24,41	24 513	190 361
Deferred and current tax		(23 044)	(35 368)
Provision for retirement benefits – actuarial gains/losses, gross	Note 41,55	3 532	(841)
Deferred tax		(925)	160
Total other comprehensive income, net		1 209 035	79 287
Total comprehensive income for the period		7 973 880	5 324 084
Total comprehensive income for the period is attributable to:
- owners of the parent entity		7 647 943	5 292 165
- non-controlling interests		325 937	31 919
Total comprehensive income for the period attributable to owners of the parent entity from:
- continuing operations		7 572 189	5 363 557
- discontinued operations		75 754	(71 392)

III. Consolidated statement of financial position

	as at:	31.12.2025	31.12.2024* restated	1.01.2024* restated
ASSETS
Cash and cash equivalents	Note 18	30 504 739	29 003 506	34 575 193
Loans and advances to banks	Note 19	2 371 648	4 031 165	262 995
Financial assets held for trading	Note 20	15 278 611	9 347 575	8 939 360
Hedging derivatives	Note 21	2 023 727	1 401 753	1 575 056
Loans and advances to customers incl.:	Note 22	162 837 724	174 776 281	159 520 007
- measured at amortised cost		148 904 495	155 594 869	143 488 004
- measured at fair value through other comprehensive income		3 167 384	4 289 996	2 798 234
- measured at fair value through profit and loss		-	63 289	85 093
- from finance leases		10 765 845	14 828 127	13 148 676
Reverse sale and repurchase agreements	Note 44	4 417 364	4 475 404	2 036 133
Investment securities incl.:	Note 24	78 865 681	70 917 031	61 276 635
- debt securities measured at fair value through other comprehensive income		28 689 816	34 847 851	41 352 202
- debt securities measured at fair value through profit and loss		-	1 247	2 005
- debt investment securities measured at amortised cost		49 689 035	35 596 997	19 639 468
- equity securities measured at fair value through other comprehensive income		486 830	462 317	277 121
- equity securities measured at fair value through profit and loss		-	8 619	5 839
Assets pledged as collateral	Note 50	2 575 358	1 198 845	271 933
Investments in associates	Note 25	990 738	967 209	967 514
Intangible assets	Note 26	987 651	979 811	881 857
Goodwill	Note 27	1 688 516	1 712 056	1 712 056
Property, plant and equipment	Note 28	764 514	795 006	765 278
Right of use assets	Note 29	542 586	489 056	494 296
Deferred tax assets	Note 30	666 797	1 414 382	1 751 189
Non-current assets classified as held for sale		8	5 400	6 453
Other assets	Note 31	3 634 415	2 859 440	1 615 930
Total assets		308 150 077	304 373 920	276 651 885
LIABILITIES AND EQUITY
Deposits from banks	Note 32	2 847 280	5 148 660	4 156 453
Hedging derivatives	Note 21	192 875	607 737	880 538
Financial liabilities held for trading	Note 20	12 363 423	9 909 687	8 818 493
Deposits from customers	Note 33	230 142 564	232 028 762	209 277 356
Sale and repurchase agreements	Note 44	2 580 543	1 198 455	273 547
Subordinated liabilities	Note 34	1 601 965	2 228 898	2 686 343
Debt securities in issue	Note 35	14 513 671	11 851 163	9 247 159
Lease liabilities	Note 51	389 100	348 450	365 833
Current income tax liabilities		1 072 135	741 297	1 174 609
Deferred tax liability		432	686	435
Provisions for financial liabilities and guarantees granted	Note 36	79 330	93 919	123 085
Other provisions	Note 37	2 302 503	2 075 840	967 106
Other liabilities	Note 38	4 559 030	3 699 180	4 989 910
Total liabilities		272 644 851	269 932 734	242 960 867
Equity
Equity attributable to owners of the parent entity		35 425 672	32 527 467	31 762 645
Share capital	Note 39	1 021 893	1 021 893	1 021 893
Other reserve capital	Note 40	23 397 608	24 424 796	25 097 202
Revaluation reserve	Note 41	914 434	(218 647)	(298 688)
Retained earnings		3 612 923	2 086 694	1 111 131
Profit for the period		6 478 814	5 212 731	4 831 107
Non-controlling interests	Note 42	79 554	1 913 719	1 928 373
Total equity		35 505 226	34 441 186	33 691 018
Total liabilities and equity		308 150 077	304 373 920	276 651 885

*Data restated following changes to the presentation of cash and cash equivalents; details are presented in Note 2.5.

IV. Consolidated statement of changes in equity

Equity attributable to owners of parent entity

Consolidated statement of changes in equity 1.01.2025 - 31.12.2025	Share capital	Own shares	Other reserve capital	Revaluation reserve	Retained earnings and profit for the period	Total	Non-controlling interests	Total equity
Note	39		40	41			42
As at the beginning of the period	1 021 893	-	24 424 796	(218 647)	7 299 425	32 527 467	1 913 719	34 441 186
Total comprehensive income:	-	-	-	1 169 129	6 478 814	7 647 943	325 937	7 973 880
Consolidated profit for the period	-	-	-	-	6 478 814	6 478 814	286 031	6 764 845
Other comprehensive income:	-	-	-	1 169 129	-	1 169 129	39 906	1 209 035
- from continuing operations	-	-	-	1 109 275	-	1 109 275	4	1 109 279
- from discontinued operations	-	-	-	59 854	-	59 854	39 902	99 756
Change due to the sale of discontinued operations	-	-	(489 943)	(41 868)	492 262	(39 549)	(2 103 626)	(2 143 175)
Share-based incentive scheme	-	-	104 902	-	-	104 902	-	104 902
Purchase of own shares	-	(82 367)	-	-	-	(82 367)	-	(82 367)
Settlements under share-based incentive scheme	-	82 367	(83 172)	-	-	(805)	-	(805)
Profit allocation to other reserve capital	-	-	281 132	-	(281 132)	-	-	-
Profit allocation to dividends	-	-	(840 887)	-	(3 897 632)	(4 738 519)	(56 476)	(4 794 995)
Other changes	-	-	780	5 820	-	6 600	-	6 600
As at the end of the period	1 021 893	-	23 397 608	914 434	10 091 737	35 425 672	79 554	35 505 226

Equity attributable to owners of parent entity

Consolidated statement of changes in equity 1.01.2024 - 31.12.2024	Share capital	Own shares	Other reserve capital	Revaluation reserve	Retained earnings and profit for the period	Total	Non-controlling interests	Total equity
Note	39		40	41			42
As at the beginning of the period	1 021 893	-	25 097 202	(298 688)	5 942 238	31 762 645	1 928 373	33 691 018
Total comprehensive income:	-	-	-	79 434	5 212 731	5 292 165	31 919	5 324 084
Consolidated profit for the period	-	-	-	-	5 212 731	5 212 731	32 066	5 244 797
Other comprehensive income	-	-	-	79 434	-	79 434	(147)	79 287
Share-based incentive scheme	-	-	100 192	-	-	100 192	-	100 192
Purchase of own shares	-	(72 334)	-	-	-	(72 334)	-	(72 334)
Settlements under share-based incentive scheme	-	72 334	(72 592)	-	-	(258)	-	(258)
Profit allocation to other reserve capital	-	-	356 395	-	(356 395)	-	-	-
Profit allocation to dividends	-	-	(1 056 637)	-	(3 504 072)	(4 560 709)	(46 573)	(4 607 282)
Transfer of revaluation of equity financial assets measured at fair value through other comprehensive income	-	-	-	(4 216)	4 216	-	-	-
Other changes	-	-	236	4 823	707	5 766	-	5 766
As at the end of the period	1 021 893	-	24 424 796	(218 647)	7 299 425	32 527 467	1 913 719	34 441 186

V. Consolidated statement of cash flows

for the period	1.01.2025-31.12.2025	1.01.2024-31.12.2024* restated
Cash flows from operating activities
Profit before tax	8 259 890	7 265 661
Adjustments for:
Share in net profits of entities accounted for by the equity method	(114 457)	(102 297)
Depreciation/amortisation	598 727	614 204
Net interest income	(12 702 826)	(13 873 216)
Gains on investing activities	(5 372)	4 041
Gains on the sale of discontinued operations	(317 975)	-
Dividends	(109 380)	(119 183)
Impairment losses (reversal)	4 768	14 091
Changes in:
Provisions	708 326	1 079 568
Financial assets / liabilities held for trading	(3 393 212)	742 344
Assets pledged as collateral	(871 283)	(1 088 492)
Hedging derivatives	(1 139 504)	244 786
Loans and advances to banks	1 842 696	(3 764 395)
Loans and advances to customers	(6 814 167)	(14 944 202)
Deposits from banks	(1 136 507)	(15 306)
Deposits from customers	14 102 307	22 632 747
Buy-sell/ Sell-buy-back transactions	1 437 682	(1 519 292)
Other assets and liabilities	1 647 232	(3 307 760)
Interest received on operating activities	14 085 800	15 462 082
Interest paid on operating activities	(3 152 205)	(3 985 161)
Paid income tax	(2 276 482)	(2 135 860)
Net cash flows from operating activities	10 654 058	3 204 360
Cash flows from investing activities
Inflows	24 408 731	16 063 828
Sale of discontinued operations, less cash and cash equivalents disposed of	2 609 444	-
Sale/maturity of investment securities	18 427 388	13 144 692
Sale of intangible assets and property, plant and equipment	12 679	29 521
Dividends received	109 380	119 183
Interest received	3 249 840	2 770 432
Outflows	(31 542 242)	(22 078 347)
Purchase of investment securities	(30 901 760)	(21 445 654)
Purchase of intangible assets and property, plant and equipment	(640 482)	(632 693)
Net cash flows from investing activities	(7 133 511)	(6 014 519)

for the period	1.01.2025-31.12.2025	1.01.2024-31.12.2024* restated
Cash flows from financing activities
Inflows	13 463 732	12 370 685
Debt securities issued	11 246 150	8 159 564
Drawing of loans	2 217 582	4 211 121
Outflows	(15 483 046)	(15 132 213)
Debt securities buy out	(6 344 548)	(5 577 382)
Repayment of loans and advances	(3 177 894)	(3 683 959)
Repayment of lease liabilities	(135 859)	(159 606)
Dividends to shareholders	(4 794 995)	(4 607 282)
Purchase of own shares	(82 367)	(72 334)
Interest paid	(947 383)	(1 031 650)
Net cash flows from financing activities	(2 019 314)	(2 761 528)
Total net cash flows	1 501 233	(5 571 687)
Cash and cash equivalents at the beginning of the accounting period	29 003 506	34 575 193
Cash and cash equivalents at the end of the accounting period	30 504 739	29 003 506

*Data restated following changes to the presentation of cash and cash equivalents; details are presented in Note 2.5.

The comparative period does not include the reclassification of part of the Group’s activities to discontinued operations. Cash flows arising from the discontinued operations are presented in Note 48.

Information regarding liabilities arising from financing activities relating to loans received, subordinated liabilities and the issue of debt securities were presented respectively in notes 32-35.

VI. Additional notes to consolidated financial statements

1. General information about issuer

Santander Bank Polska SA is a bank located in Poland, 00-854 Warszawa, al. Jana Pawła II 17, National Court Registry identification number is 0000008723, TIN os 896-000-56-73, National Official Business Register number (REGON) is 930041341.

Consolidated financial statement of Santander Bank Polska Group includes the Bank’s financial information as well as information of its subsidiaries (forming together the “Group”).

As at 31 December 2025, the immediate and ultimate parent of Santander Bank Polska S.A. was Banco Santander S.A., headquartered in Santander. As at the date of publication of these financial statements, the parent entity is Erste Group Bank AG headquartered in Austria.

Santander Bank Polska Group offers a wide range of banking services to individual and business customers and operates in domestic and interbank foreign markets. It also offers the following services:

· intermediation in trading in securities,

· leasing,

· factoring,

· asset/ fund management,

· insurance distribution services,

· trading in shares of commercial companies,

· brokerage services.

Santander Bank Polska Group consists of the following entities:

Subsidiaries:

	Subsidiaries	Registered office	[%] of votes on AGM at 31.12.2025	[%] of votes on AGM at 31.12.2024
1.	Santander Finanse sp. z o.o.	Poznań	100%	100%
2.	Santander Factoring sp. z o.o.	Warszawa	100% of AGM votes are held by Santander Finanse sp. z o.o.	100% of AGM votes are held by Santander Finanse sp. z o.o.
3.	Santander Leasing S.A.	Poznań	100% of AGM votes are held by Santander Finanse sp. z o.o.	100% of AGM votes are held by Santander Finanse sp. z o.o.
4.	SPV XX04062025 Sp. z o.o. in liquidation (previous name Santander Inwestycje sp. z o.o.)⁴⁾	Warszawa	100%	100%
5.	Santander F24 S.A.	Poznań	100% of AGM votes are held by Santander Finanse sp. z o.o.	100% of AGM votes are held by Santander Finanse sp. z o.o.
6.	Santander Towarzystwo Funduszy Inwestycyjnych S.A. ¹⁾	Poznań	50%	50%
7.	Santander Consumer Bank S.A. ⁵⁾	Wrocław	-	60%
8.	Stellantis Financial Services Polska Sp. z o.o^{. 2)and5)}	Warszawa	-	50% of AGM votes are held by Santander Consumer Bank S.A. and 50% of AGM votes are held by Stellantis Financial Services S.A.
9.	Stellantis Consumer Financial Services Polska Sp. z o.o. ^2)and5)	Warszawa	-	100% of AGM votes are held by Stellantis Financial Services Polska Sp. z o.o.
10.	Santander Consumer Multirent sp. z o.o.⁵⁾	Wrocław	-	100% of AGM votes are held by Santander Consumer Bank S.A.
11.	SCM POLAND AUTO 2019-1 DAC ⁵⁾	Dublin	-	subsidiary of Santander Consumer Multirent S.A.
12.	Santander Consumer Financial Solutions Sp. z o.o. ⁵⁾	Wrocław	-	subsidiary of Santander Consumer Multirent S.A.
13.	S.C. Poland Consumer 23-1 DAC.^3)and5)	Dublin	-	subsidiary of Santander Consumer Bank S.A.

1.Until 9 January 2026, the owners of Santander Towarzystwo Funduszy Inwestycyjnych S.A. (Santander TFI S.A.), i.e. Santander Bank Polska S.A. and Banco Santander S.A., were members of the global Santander Group and held an equal stake of 50% in the company’s share capital. Santander Bank Polska S.A. exercises control over Santander TFI S.A. within the meaning of the International Financial Reporting Standard 10 (IFRS 10) because it has a practical ability to unilaterally direct the relevant activities of Santander TFI S.A. Furthermore, it significantly affects the company’s operations and returns as the major business partner and distributor of investment products. At the same time, through its ownership interest, Santander Bank Polska S.A. is exposed and has right to variable returns generated by Santander TFI S.A. Considering the guidance provided in IFRS 10 par. B18, the Bank’s Management Board concluded that, having regard to legal requirements concerning Santander TFI S.A. and its operations, the Bank has a practical ability to unilaterally direct the relevant activities of Santander TFI S.A. even if it does not have a contractual right to do so. The Bank can have a real impact on the composition of the Supervisory Board and through it – on the composition of the Management Board of Santander TFI S.A. and these governing bodies decide on the relevant activities of Santander TFI S.A. It should therefore be concluded that by having power and right to variable returns (benefits), the Bank has control over Santander TFI S.A. The sale of 49% of shares of Santander Bank Polska S.A. and 50% of shares of Santander TFI S.A. to Erste Group Bank AG (Erste Group), completed by Banco Santander S.A. on 9 January 2026, did not affect the Bank’s assessment regarding its control over Santander TFI S.A.

2.Stellantis Financial Services Polska Sp. z o.o. is a subsidiary undertaking for the purpose of preparation of consolidated financial statements as at 31 December 2024 and for the period of exercising control in 2025, i.e. until 23 December 2025, as it is controlled by Santander Consumer Bank S.A. (directly) and Santander Bank Polska S.A. (indirectly). Pursuant to the framework agreement, Santander Consumer Bank S.A. (SCB S.A.) had the right to make decisions regarding key areas such as financing and risk management. In practice, the Bank has the ability to direct activities that significantly affect investment returns and was exposed to potential risks (losses) and had rights to benefits (dividends).

3. SC Poland Consumer 23-1 Designated Activity Company (DAC) is a special purpose entity (SPE) incorporated in Dublin on 17 June 2022 for the purpose of securitising a part of the retail loan portfolio of Santander Consumer Bank S.A. (SCB S.A.) The SPE does not have any capital connections with SCB S.A., which nevertheless exercises control over the entity in accordance with IFRS 10.7. based on contractual rights. The combined stipulations of Servicing Agreement and Asset Transfer Agreement give SCB S.A. power over the management and operations of the SPE. In addition, the entity relies on SCB S.A. for access to financing and guarantees as well as technology, know-how and other resources, which further enhances the controlling power of the Bank.

4. On 27 June 2025, the Extraordinary General Meeting of Santander Inwestycje Sp. z o.o. decided to start the liquidation of the company on 1 July 2025, appoint a liquidator and change the company’s name to SPV XX04062025 (effective as of its registration in the National Court Register).

5. On 23 December 2025, a final agreement was concluded with Santander Consumer Finance S.A. for the sale by the Bank to SCF of 3,120,000 shares in Santander Consumer Bank S.A., representing 60% of the share capital of SCB and 60% of the total number of votes, for a total sale price of PLN 3,105,000,000. The Transaction closed on 23 December 2025, and from that date the Bank is no longer a shareholder of Santander Consumer Bank S.A. . Detailed information is presented in Note 48.

Associates:

	Associates	Registered office	[%] of votes on AGM at 31.12.2025	[%] of votes on AGM at 31.12.2024
1.	POLFUND - Fundusz Poręczeń Kredytowych S.A.	Szczecin	50%	50%
2.	Santander - Allianz Towarzystwo Ubezpieczeń S.A.	Warszawa	49%	49%
3.	Santander - Allianz Towarzystwo Ubezpieczeń na Życie S.A.	Warszawa	49%	49%

2. Basis of preparation of consolidated financial statements

2.1 Statement of compliance

These consolidated financial statements of Santander Bank Polska S.A. Group were prepared in accordance with the International Financial Reporting Standards (IFRS) as adopted by the European Union, which are applied on a consistent basis, as at 31 December 2025, and in the case of matters not governed by the above Standards, in accordance with the provisions of the Accounting Act of 29 September 1994 and related implementing acts as well as the requirements imposed on issuers whose securities are admitted to trading on regulated markets or issuers who have applied to have securities admitted to trading on regulated markets outlined in the Act of 29 July 2005 on Public Offering, on Conditions for the Introduction of Financial Instruments to the Organized Trading System and on Public Companies.

These consolidated financial statements have been approved for publication by the Management Board of Santander Bank Polska S.A. on 23 February 2026.

2.2 Basis of preparation of financial statements

These consolidated financial statements have been prepared on the assumption that the Group companies will continue in non-significantly reduced scope as going concern in the foreseeable future, i.e. for a period of at least 12 months from the date on which these financial statements were prepared. The sale of 60% of shares in Santander Consumer Bank to Santander Consumer Finance S.A., does not affect the ability of Santander Bank Polska S.A. Group to continue its operations also in the changed structure. Details regarding discontinued operations are presented in note 48 Discontinued operations.

Consolidated financial statements are presented in PLN, rounded to the nearest thousand.

These consolidated financial statements of Santander Bank Polska S.A. Group have been prepared in accordance with the International Financial Reporting Standards (IFRS) adopted by the European Union. Santander Bank Polska S.A. Group prepared consolidated financial statements in accordance with following measurement rules:

Item	Balance sheet valuation rules
Held-for-trading financial instruments	Fair value through profit or loss
Loans and advances to customers which meet the contractual cash flows test	Amortized cost
Loans and advances to customers which do not meet the contractual cash flows test	Fair value through profit or loss
Financial instruments measured at fair value through other comprehensive income	Fair value through other comprehensive income
Share-based payment transactions	According to IFRS 2 "Share-based payment" requirements
Equity investment financial assets	Fair value through other comprehensive income – an option
Equity financial assets-trading	Fair value through profit or loss
Debt securities measured at fair value through profit or loss	Fair value through profit or loss
Non-current assets	The purchase price or production cost reduced by total depreciation charges and total impairment losses
Right of use assets (IFRS 16)	Initial measurement reduced by total depreciation charges and total impairment losses
Non-current assets held for sale and groups of non-current assets designated as held for sale	Are recognised at the lower of their carrying amount and their fair value less costs of disposal.

The accounting principles have been applied uniformly by all the entities forming Santander Bank Polska S.A. Group.

The same accounting principles were applied as in the case of the consolidated financial statements for the period ending 31 December 2024, except for changes in accounting standards p. 2.4., changes in the presentation of “Cash and cash equivalents” described in note 2.5, and discontinued operations described in note 48.

2.3 New standards and interpretations or changes to existing standards or interpretations which can be applicable to Santander Bank Polska S.A. Group and are not yet effective and have not been early adopted

IFRS	Nature of changes	Effective from	Influence on Santander Bank Polska S.A. Group
Amendments to the Classification and Measurement of Financial Instruments (Amendments to IFRS 9 and IFRS 7)	Amendments regarding classification and measurement of financial instruments clarify derecognition of a financial liability settled through electronic transfer,present examples of contractual terms that are consistent with a basic lending arrangement,clarify characteristics of non-recourse features and contractually linked instruments and specify new disclosures.	1 January 2026	The amendment may have impact on classification, cash in transits and some of the disclosures in consolidated financial statements.
Annual Improvements to IFRS Accounting Standards	Collection of amendments to IFRS Accounting Standards that will not be a part of any other project and adress necessary, but non-urgent, minor updates. Amendments concern IFRS 7, IFRS 9, IFRS 10, IAS 7.	1 January 2026	The amendment will not have a significant impact on consolidated financial statements.
Amendments to IFRS 9 and IFRS 7: Contracts Referencing Nature-dependent Electricity	The amendments made to IFRS 9 include detail on which power purchase agreements (PPAs) contracts can be used in hedge accounting, and the specific conditions allowed in such hedge relationships. The amendments made to IFRS 7 introduce some new disclosure requirements for contracts referencing naturedependent electricity as defined in the amendments to IFRS 9.	1 January 2026	The amendment will not have a significant impact on consolidated financial statements.
IFRS 18 Presentation and Disclosure in Financial Statements	IFRS 18 includes requirements for all entities applying IFRS for the presentation and disclosure of information in financial statements. IFRS 18 replaces IAS 1.	1 January 2027	The amendment may have impact on cash flow statement, some of the disclosures and income statement in consolidated financial statements.*
IFRS 19 Subsidiaries without Public Accountability: Disclosures	IFRS 19 specifies reduced disclosure requirements that an eligible entity is permitted to apply instead of the disclosure requirements in other IFRS Accounting Standards.	1 January 2027	The amendment will not have an impact on consolidated financial statements.*
IAS 21 Translation to a Hyperinflationary Presentation Currency	The amendments apply to companies with a non-hyperinflationary functional currency using a hyperinflationary presentation currency and also apply to companies with hyperinflationary functional and presentation currencies that translate the results and financial position of foreign operations whose functional currency is non-hyperinflationary. The amendmants gives information on how such positions should be translated.	1 January 2027	The amendment will not have an impact on consolidated financial statements.*
* New standards and amendments to existing standards issued by the IASB but not yet endorsed for use in the EU

2.4 Standards and interpretations or changes to existing standards or interpretations which were applied for the first time in the accounting year 2025

IFRS	Nature of changes	Effective from	Influence on Santander Bank Polska S.A. Group
Amendments to IAS 21: Lack of Exchangeability	Amendments require disclosure of information that enables users of financial statements to understand the impact of a currency not being exchangeable.	1 January 2025	The amendment does not have a significant impact on consolidated financial statements.

2.5 Comparability with the results from the previous periods

Presentation of cash and cash equivalents in the statement of financial position

The section below describes presentation changes made to the consolidated financial statements of Santander Bank Polska Group for 2025, affecting the consolidated statement of financial position as at 1 January 2024 and 31 December 2024.

Financial assets with original maturity of up to three months, meeting the definition of cash and cash equivalents namely loans and advances to banks and debt investment securities (NBP bills), are presented under “Cash and cash equivalents” together with assets that used to be disclosed under “Cash and balances with central banks”. In the Group’s view, such presentation is reliable and more relevant for readers of the statement of financial position as the total amount of cash and cash equivalents is directly indicated. It is also consistent with the guidelines of the IFRS Interpretations Committee and requirements of IAS 7 Statement of Cash Flows and IAS 1 Presentation of Financial Statements. The foregoing changes in the accounting policies made it necessary to restate the comparative data but did not affect the Group’s total assets, net profit or equity. The changes also had no effect on the value of cash and cash equivalents presented in the cash flow statement.

The impact of the above change on the published consolidated financial statements as at 1 January 2024 and 31 December 2024 is presented below.

Items in the consolidated statement of financial position

	as at: 1.01.2024
	before	adjustment	after
Cash and cash equivalents	-	34 575 193	34 575 193
Cash and balances with central banks	8 417 519	(8 417 519)	-
Loans and advances to banks	9 533 840	(9 270 845)	262 995
Reverse sale and repurchase agreements	12 676 594	(10 640 461)	2 036 133
Investment securities incl.:	67 523 003	(6 246 368)	61 276 635
- debt securities measured at fair value through other comprehensive income	47 598 570	(6 246 368)	41 352 202
Total assets	276 651 885	-	276 651 885

	as at: 31.12.2024
	before	adjustment	after
Cash and cash equivalents	-	29 003 506	29 003 506
Cash and balances with central banks	10 575 107	(10 575 107)	-
Loans and advances to banks	8 812 988	(4 781 823)	4 031 165
Reverse sale and repurchase agreements	12 126 356	(7 650 952)	4 475 404
Investment securities incl.:	76 912 655	(5 995 624)	70 917 031
- debt securities measured at fair value through other comprehensive income	40 843 475	(5 995 624)	34 847 851
Total assets	304 373 920	-	304 373 920

Presentation of net interest income in the statement of cash flows

Changes were made to the presentation of net interest income. Previously, interest accrued on operating activities adjusted, among other things, the balance of financial assets/liabilities held for trading, hedging derivatives, loans and advances to banks, loans and advances to customers, deposits from banks and deposits from customers. Now, it is presented under a separate line item: Net interest income including accrued interest excluded from operating activities, with the latter item previously presented separately.

Such presentation is based on prevailing market practice and, in the Group’s opinion, better reflects the nature of the above items in the statement of cash flows. The foregoing changes in the accounting policies made it necessary to restate the comparative data but did not affect the total net cash flows.

Items of the consolidated statement of cash flows

for the period:	1.01.2024-31.12.2024
	before	adjustment	after
Cash flows from operating activities
Profit before tax	7 265 661		7 265 661
Adjustments for:
Net interest income	-	(13 873 216)	(13 873 216)
Interest accrued excluded from operating activities	(1 832 568)	1 832 568	-
Changes in:
Provisions	1 079 568	-	1 079 568
Financial assets / liabilities held for trading	689 235	53 109	742 344
Assets pledged as collateral	(1 088 492)	-	(1 088 492)
Hedging derivatives	308 029	(63 243)	244 786
Loans and advances to banks	(4 669 728)	905 333	(3 764 395)
Loans and advances to customers	(29 617 191)	14 672 989	(14 944 202)
Deposits from banks	117 305	(132 611)	(15 306)
Deposits from customers	26 423 635	(3 790 888)	22 632 747
Buy-sell/ Sell-buy-back transactions	(1 915 251)	395 959	(1 519 292)
Other assets and liabilities	(3 307 760)	-	(3 307 760)
Net cash flows from operating activities	3 204 360	-	3 204 360
Total net cash flows	(5 571 687)	-	(5 571 687)
Cash and cash equivalents at the beginning of the accounting period	34 575 193	-	34 575 193
Cash and cash equivalents at the end of the accounting period	29 003 506	-	29 003 506

2.6 Use of estimates

Preparation of financial statement in accordance with the IFRS requires the management to make subjective judgements and assumptions, which affects the applied accounting principles as well as presented assets, liabilities, revenues and expenses.

The estimates and assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgments about carrying amounts of assets and liabilities that are not readily apparent from other sources.

The estimates and assumptions are reviewed on an ongoing basis. Changes to estimates are recognised in the period in which the estimate is changed if the change affects only that period, or in the period of the change and future periods if the change affects both current and future periods.

Key accounting estimates made by Santander Bank Polska S.A. Group

Key estimates include:

· Allowances for expected credit losses

· Fair value of financial instruments

· Estimates of provisions for legal claims

· Estimates of risk arising from mortgage loans in foreign currencies

Allowances for expected credit losses in respect of financial assets

The IFRS 9 approach is based on estimation of the expected credit loss (ECL). ECL allowances reflect an unbiased and probability-weighted amount that is determined by evaluating a range of possible outcomes, the time value of money; and reasonable and supportable information that is available without undue cost or effort at the reporting date about past events, current conditions and forecasts of future economic conditions. ECL allowances are measured at an amount equal to a 12-month ECL or the lifetime ECL, when it is deemed there has been a

significant increase in credit risk since initial recognition (Stage 2) or impairment (Stage 3). Accordingly, the ECL model gives rise to measurement uncertainty, especially in relation to:

· measurement of a 12-month ECL or the lifetime ECL;

· determination of whether/when a significant increase in credit risk occurred;

· determination of any forward-looking information reflected in ECL estimation, and their likelihood.

As a result, ECL allowances are estimated using the adopted model developed using many inputs and statistical techniques. Structure of the models that are used for the purpose of ECL estimation consider models for the following parameters:

· PD - Probability of Default, i.e. the estimate of the likelihood of default over a given time horizon (12-month or lifetime);

· LGD - Loss Given Default, i.e. the part of the exposure amount that would be lost in the event of default;

· EAD – Exposure at Default, i.e. expectation for the amount of exposure in case of default event in a given horizon 12-month or lifetime.

Changes in these estimates and the structure of the models may have a significant impact on ECL allowances.

In accordance with IFRS 9, the recognition of expected credit losses depends on changes in credit risk level which occur after initial recognition of the exposure. The standard defines three main stages for recognising expected credit losses:

· Stage 1 exposures with no significant increase in credit risk since initial recognition, i.e. the likelihood of the exposure being downgraded to the impaired portfolio (Stage 3 exposures) has not increased. For such exposures, 12-month expected credit losses are recognised

· Stage 2 – exposures with a significant increase in credit risk since initial recognition, but with no objective evidence of impairment. For such exposures, lifetime expected credit losses are recognised.

· Stage 3 – exposures for which the risk of default has materialised (objective evidence of impairment has been identified). For such exposures, lifetime expected credit losses are recognised

For the purpose of the collective evaluation of ECL, financial assets are grouped on the basis of similar credit risk characteristics that indicate the debtors' ability to pay all amounts due according to the contractual terms (for example, on the basis of the Group’s credit risk evaluation or the rating process that considers asset type, industry, geographical location, collateral type, past-due status and other relevant factors). The characteristics chosen are relevant to the estimation of future cash flows for groups of such assets by being indicative of the debtors' ability to pay all amounts due according to the contractual terms of the assets being evaluated. The rating/scoring systems have been internally developed and are continually being enhanced, e.g through external analysis that helps to underpin the aforementioned factors which determine the estimates of impairment charges.

In the individual approach, the ECL charge was determined based on the calculation of the total probability-weighted impairment charges estimated for all the possible recovery scenarios, depending on the recovery strategy currently expected for the customer.

In the scenario analysis, the key strategies / scenarios used were as follows:

· Recovery from the operating cash flows / refinancing / capital support;

· Recovery through the voluntary realisation of collateral;

· Recovery through debt enforcement;

· Recovery through systemic bankruptcy/recovery proceeding/liquidation bankruptcy;

· Recovery by take-over of the debt / assets / sale of receivables

· Recovery as part of legal restructuring.

In addition, for exposures classified as POCI (purchased or originated credit impaired) - i.e. purchased or orginated financial assets that are impaired on initial recognition, expected credit losses are recognized over the remaining life horizon. Such an asset is created when impaired assets are initially recognized and the POCI classification is maintained over the life of the asset.

A credit-impaired assets

Credit-impaired assets are classified as Stage 3 or POCI. A financial asset or a group of financial assets are impaired if, and only if, there was objective evidence of impairment as a result of one or more events that occurred after the initial recognition of the asset or asset was recognized as POCI and that impairment event (or events) had an impact on the estimated future cash flows of the financial asset or group of financial assets that could be reliably estimated.

It may not be possible to identify a single event that caused the impairment, rather the combined effect of several events may have caused the impairment. Objective evidence that a financial asset or group of assets was impaired includes observable data:

· significant financial difficulty of the issuer or debtor;

· a breach of contract, e.g. delay in repayment of interest or principal over 90 days in an amount exceeding the materiality threshold (PLN 400 for individual and small and medium-sized enterprises and PLN 2,000 for business and corporate clients) and at the same time relative thresholds (above 1% of the amount past due in relation to the balance sheet amount);

· the Santander Bank Polska S.A. Group, for economic or legal reasons relating to the debtor's financial difficulty, granting to the debtor a concession that the Santander Bank Polska S.A. Group would not otherwise consider, which fulfil below criteria:

(1) restructuring transactions classified in the Stage 3 category (before restructuring decision),

(2) transactions restructured in the contingency period that meet the criteria for reclassification to the Stage 3 (quantitative and/or qualitative),

(3) transactions restructured during the contingency period previously classified as non-performing due to observed customer financial difficulties, have been restructured again or are more than 30 days past due,

(4) restructured transactions, where contractual clauses have been applied that defer payments through a grace period for repayment of the principal for a period longer than two years,

(5) restructured transactions including debt write-off, interest grace periods or repaid in installments without contractual interest,

(6) restructured transactions, where there was a decrease in the net present value of cash flows (NPV) of at least 1% compared to the NPV before the application of the forbearance measures,

(7) transactions where there is a repeated failure to comply with the established payment plan of previous forbearances that has led to successive forbearances of the same exposure (transaction),

(8) transactions where:

· in inadequate repayment schedules were applied, which are related to, inter alia, repeated situations of non-compliance with the schedule, changes in the repayment schedule in order to avoid situations of non-compliance with it, or

· a repayment schedule that is based on expectations, unsupported by macroeconomic forecasts or credible assumptions about the borrower's ability or willingness to repay was applied

(9) transactions for which the Group has reasonable doubts as to the probability of payment by the customer.

· it becoming probable that the debtor will enter bankruptcy, recovery proceedings, arrangement or other financial reorganisation;

· the disappearance of an active market for that financial asset because of financial difficulties;

Impaired exposures (Stage 3) can be reclassified to Stage 2 or Stage 1 if the reasons for their classification to Stage 3 have ceased to apply (particularly if the borrower’s economic and financial standing has improved) and a probation period has been completed (i.e. a period of good payment behaviour meaning the lack of arrears above 30 days), subject to the following:

· In the case of individual customers, the probation period is 180 days.

· In the case of SME customers, the probation period is 180 days, and assessment of the customer’s financial standing and repayment capacity is required in some cases. However, the exposure cannot be reclassified to Stage 1 or 2 in the case of fraud, client`s death, discontinuation of business, bankruptcy, or pending restructuring/ liquidation proceedings.

· In the case of business and corporate customers, the probation period is 92 days, and positive assessment of the financial standing is required (the Group assesses all remaining payments as likely to be repaid as scheduled in the agreement). The exposure cannot be reclassified to Stage 1 or 2 in the case of fraud, discontinuation of business, or pending restructuring/ insolvency/ liquidation proceedings.

Additionally, if the customer is in Stage 3 and subject to the forbearance process, they may be reclassified to Stage 2 not earlier than after 365 days (from the start of forbearance or from the downgrade to the NPL portfolio, whichever is later) of regular payments, repayment by the client of the amount previously overdue / written off (if any) and after finding that there are no concerns as to the further repayment of the entire debt in accordance with the agreed terms of restructuring.

A significant increases in credit risk

One of the key elements of IFRS 9 is the identification of a significant increase in credit risk which determines the classification to Stage 2. The Group has developed detailed criteria for the definition of a significant increase in credit risk based on the following main assumptions:

· Qualitative assumptions:

· Implementing dedicated monitoring strategies for the customer following the identification of early warning signals that indicate a significant increase in credit risk

· Restructuring actions connected with making concessions to the customers as a result of their difficult financial standing

· Delay in payment as defined by the applicable standard, i.e. 30 days past due combined with the materiality threshold

· Quantitative assumptions:

· A risk buffer method based on the comparison of curves illustrating the probability of default over the currently remaining lifetime of the exposure based on the risk level assessment at exposure recognition and at reporting date. Risk buffer is set in relative terms for every single exposure based on its risk assessment resulting from internal models and other parameters of exposure impacting assessment of the Group whether the increase might have significantly increased since initial recognition of the exposure (such parameters considered types of the products, term structure as well as profitability). Risk buffer methodology was prepared internally and is based on the information gathered in the course of the decision process as well as in the process of transactions structuring.

· Absolute threshold criterion - a significant increase in risk is considered to have occurred when, over the horizon of the current remaining life of the exposure, the annualised PD at the reporting date exceeds the corresponding PD at the time the exposure was recognised by an amount greater than the threshold.

· In addition, the Bank applies the threefold risk criterion. It is met when, over the horizon of the current remaining life of the exposure, the annualised PD as at the reporting date exceeds three times the corresponding PD at the time the exposure was recognised.

The fact that the exposure is supported by the Borrowers' Support Fund is reported as a forborne and a significant increase in credit risk (Stage 2), and in justified cases (previously identified impairment, subsequent restructuring action, inability to service the debt forecasted on the basis of defined criteria) constitutes an indication of impairment (Stage 3).

The average thresholds according to data as at 31.12.2025 (expressed in terms of PD over a one-year horizon), exceeding which results in the classification of the exposure to Stage 2 in accordance with the quantitative risk buffer method used by the Group, are presented in the table below

Average threshold (annualized) of the probability of default
mortgage loans	3.20%
consumer loans	14.14%
business loans	6.23%

Santander Bank Polska S.A. Group independently verifies the fulfillment of other quantitative thresholds (the absolute threshold criterion and the threefold risk increase criterion).

Santander Bank Polska S.A. identifies exposures with low credit risk in its corporate segment in accordance with the rules under IFRS 9, which allows for the recognition of 12-month expected losses even if credit risk has increased significantly since initial recognition. As of 31 December 2025, this portfolio was immaterial and represented 0.148% of Santander Bank Polska S.A.'s portfolio classified as Stage 1 or Stage 2.

Exposure in Stage 2 may be re-classified into Stage 1 without probation period as soon as significant increase in credit risk indicators after its initial recognition end e.g. when the following conditions are met: client`s current situation does not require constant monitoring, no restructuring actions towards exposure are taken, exposure has no payment delay over 30 days for significant amounts, and according to risk buffer method no risk increase occurs.

ECL measurement

Another key feature required by IFRS 9 is the approach to the estimation of risk parameters. For the purpose of estimating allowances for expected losses, Santander Bank Polska S.A. Group uses its own estimates of risk parameters that are based on internal models. Expected credit losses are the sum of individual products for each exposure of the estimated values of PD, LGD and EAD parameters in particular periods (depending on the stage either in the horizon of 12 months or in lifetime) discounted using the effective interest rate.

The estimated parameters are adjusted for macroeconomic scenarios in accordance with the assumptions of IFRS 9.

To this end, the Group determines the factors which affect individual asset classes to estimate an appropriate evolution of risk parameters.

The Group uses scenarios developed internally by the analytical team, which are updated on a monthly basis at least every six months.

The models and parameters generated for the needs of IFRS 9 are subject to model management process and periodic calibration and validation. These tools are also used in the financial planning process.

Determination of forward-looking information and their likelihood

Forward-looking events are reflected both in the process of estimating ECL and when determining a significant increase in credit risk, by developing appropriate macroeconomic scenarios and then reflecting them in the estimation of parameters for each scenario. The final parameter value and the ECL is the weighted average of the parameters weighted by the likelihood of each scenario. Group uses three scenario types: the baseline scenario and two alternative scenarios, which reflect the probable alternative options of the baseline scenario: upside and downside scenario. Scenario weights are determined using the expected GDP path and the confidence intervals for this forecast in such a way that the weights reflect the uncertainty about the future development of this factor.

The Group's models most often indicate the dependence of the quality of loan portfolios on the market situation in terms of the level of deposits, loans, as well as the levels of measures related to interest rates.

Baseline scenario

The Polish economy accelerated to 3.6% growth in 2025, compared to 2.9% y/y growth in 2024. The scenario predicts GDP growth of 3.7% in 2026 and 3.2% in 2027. Growth in 2025 was driven primarily by strong private consumption, supported by a robust labour market and the start of a new investment cycle related to the spending of European funds and military spending. A further strong acceleration in investment driven by EU funds is expected in 2026. Inflation has gradually begun to stabilize near the National Bank of Poland target, and the baseline scenario predicts CPI to average around 3% in 2026 and around 2.5% in subsequent years.

Monetary policy in 2025 brought a series of interest rate cuts. High economic growth and relatively high wage growth have led the central bank to adopt cautious decisions, with no clearly declared monetary easing cycle. The baseline scenario assumes a reduction in the NBP reference rate to 3.50% by the end of 2026. In 2027, the scenario predicts a slight upward adjustment to 3.75%. These expectations are based on market valuations as of October 14, 2025.

The EURPLN fell by approximately 0.8% in 2025 compared to the previous year, fluctuating between 4.20 and 4.27 for most of the year, and below 4.25 in the second half. The positive impact of the resilience of domestic economic growth and the likely end of the NBP interest rate cuts will be offset by persistent geopolitical uncertainty, gradually increasing current account imbalances, and expansionary fiscal policy. In 2026 and beyond, we assume a stable EURPLN exchange rate of 4.25.

The credit market saw a significant recovery in 2025, and a growth of 6.4% y/y for the entire year, compared to 5.0% a year earlier. The favourable domestic economic climate and lower interest rates will continue to stimulate the entire market in the coming quarters, leading the baseline scenario to project an acceleration in credit growth to 7.1% y/y in 2026 and a slightly slower rate of 6.7% y/y in 2027. In 2025, deposit growth hovered around 10% y/y, partly due to a strong increase in net foreign assets in the banking system. Deposit volume growth will continue to outpace loan growth, though the difference will be smaller. In the baseline scenario, we assume deposit growth of 8.6% in 2026 and 8.3% in 2027.

Best case scenario

The optimistic scenario assumes rapid disbursement of EU funds, strong private consumption, and a strong inflow of workers into the economy, which will allow it to record higher long-term growth rates.

It is assumed that the economy will accelerate to 6.3% in 2026, and 4.7% in 2027. Strong economic growth and the risk of higher CPI inflation will reduce the Monetary Policy Council's willingness to cut interest rates, and the NBP rate will return to 5.00% in the first half of 2026 and remain at this level in subsequent quarters. As a result, CPI inflation will increase moderately, averaging 3.2% in 2026, and 2.9% in 2027.

The Polish zloty will strengthen in the coming quarters. The euro exchange rate will reach a low of 4.05 in early 2026, stabilizing at 4.10 thereafter.

The acceleration in economic activity will have a positive impact on demand for loans in the banking system, which will also support money creation and deposit growth.

Worst case scenario

The negative scenario assumes a deterioration in consumer sentiment, leading to a decline in private consumption in the short term, accompanied by a weaker absorption of EU funds, which translates into lower investment expenditures in the economy, as well as a weaker inflow of foreign workers, which weakens Poland's long-term growth potential.

In the negative scenario, the economy will grow by 1.1% in 2026, and 1.7% in 2027. Slower growth will translate into slightly faster disinflation, with the CPI falling to 2.6% in 2026, and 2.0% in 2027.

Weaker growth prospects will encourage NBP to further lower interest rates, causing the NBP reference rate to fall to 2.50% by the end of 2026 and remain unchanged in 2027.

Less optimistic economic performance and low NBP interest rates will weaken the złoty, and the euro will appreciate towards 4.40.

Lower economic activity will negatively impact demand for loans in the banking system, both in the household sector and in corporate loans.

The tables below present the key economic indicators arising from the respective scenarios.

Scenario as at 31.12.2025		baseline		best case		worst case
likelihood		60%		20%		20%
		2026	average, next 3 years	2026	average, next 3 years	2026	average, next 3 years
GDP	YoT	3.7%	3.1%	6.3%	4.6%	1.1%	1.9%
WIBOR 3M	average	3.7%	3.9%	5.1%	5.3%	2.7%	2.7%
unemployment rate	% active	3.1%	3.1%	3.0%	2.9%	3.2%	3.5%
CPI	YoY	3.0%	2.5%	3.2%	2.8%	2.6%	2.2%
EURPLN	period-end	4,25	4,25	4,07	4,09	4,42	4,40

Scenario as at 31.12.2024		baseline		best case			worst case
likelihood		60%		20%			20%
		2025	average, next 3 years		2025	average, next 3 years		2025	average, next 3 years
GDP	YoT	3,5%	3,1%		5,7%	5,1%		1,6%	1,7%
WIBOR 3M	average	5,2%	4,5%		5,6%	5,3%		3,9%	3,7%
unemployment rate	% active	2,9%	2,9%		2,7%	2,3%		3,2%	3,7%
CPI	YoY	4,6%	2,8%		5,2%	3,1%		4,0%	2,4%
EURPLN	period-end	4,35	4,37		4,24	4,26		4,43	4,46

Management ECL overlays

As at 31 December 2025 Santander Banka Polska S.A. Group has no significant overlays due to credit risk.

Potential variability of ECL

Significant volatility for the income statement may be reclassifications to Stage 2 from Stage 1. The theoretical reclassification of given percentage of exposures from Stage 1 with the highest risk level to Stage 2 for each type of exposure would result in an increase in allowances according to below table. The above estimates show expected variability of loss allowances as a result of transfers between Stage 1 and Stage 2, resulting in significant changes in the degree to which exposures are covered with allowances in respect of different ECL horizons.

The data from Santander Bank Polska S.A. Group as at 31.12.2025, excluding data from Santander Consumer Bank S.A. Group

	additional expected credit loss (mPLN)
reclassification from stage 1 to stage 2	individuals	mortgage loans	business	Total 31.12.2025	Total 31.12.2024
1%	8,0	4,7	5,9	18,6	31,5
5%	30,9	13,2	48,3	92,4	151,1
10%	49,6	20,7	79,7	150,0	291,7

Changes in forecasts of macroeconomic indicators may result in significant effects affecting the level of created provisions. Adoption of macroeconomic parameter estimates at only one scenario level (pessimistic or optimistic) will result in a one-off change in ECL at the level below.

in PLN m		change in ECL level
scenario				31.12.2025	31.12.2024
	individuals	mortgage	business	Total	Total
worst case	58,3	9,9	40,0	108,2	84,3
best case	(55,2)	(9,5)	(33,9)	(98,6)	(86,7)

Based on GDP as the main factor determining the condition of the economy, Santander Bank Polska S.A. Group estimates that a 1% reduction in the target level of gross domestic production in 2025 would translate into an increase in expected credit losses of PLN 39,799 k. The above analysis was prepared assuming that the relationships between macroeconomic factors remain unchange.

Fair value of financial instruments, including instruments which do not meet the contractual cash flows test

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

Santander Bank Polska S.A. Group applies a methodology for measuring the fair value of credit exposures and debt instruments.

In the case of the instruments with distinguishable on-balance sheet and off-balance sheet components, the extent of fair value measurement will depend on the nature of the underlying exposure, and:

· the on-balance sheet portion always will be measured at fair value;

· the off-balance sheet portion will be measured at fair value only if at least one of the following conditions is met:

· condition 1: the exposure has been designated as measured at fair value (option) or

· condition 2: the exposure may be settled net in cash or through another instrument or

· condition 3: Santander Bank Polska S.A. Group sells the obligation immediately after its granting or

· condition 4: the obligation was granted below the market conditions.

The fair value is measured with the use of valuation techniques appropriate in the circumstances and for which sufficient data are available, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.

The Group applies following valuation techniques:

· market approach – uses prices and other relevant information generated by market transactions involving identical or comparable (similar) assets, liabilities, or a group of assets and liabilities (e.g. a business unit)

· income approach – converts future amounts (cash flows or income and expenses) to a single current (discounted) date. When the income approach is used, the fair value measurement reflects the current market expectations as to the future amounts.

Santander Bank Polska S.A. Group uses the income approach for fair value measurement relating to debt financial instruments which do not meet contractual cash flows test.

In the case of credit exposures and debt instruments, the present value method within income approach is typically used. In this method, the expected future cash flows are estimated and discounted using a relevant interest rate. In the case of the present value method, Santander Bank Polska S.A. Group uses the following elements in the valuation:

· expectations as to the future cash flows;

· expectations as to potential changes in cash flow amounts and timing (uncertainties are inherent in cash flow estimates);

· the time value of money, estimated using risk-free market rates;

· the price of uncertainty risk inherent in cash flows (risk premium) and

· other factors that market participants would take into account in the circumstances.

The present value measurement approach used by Santander Bank Polska S.A. Group is based on the following key assumptions:

· cash flows and discount rates reflect the assumptions that market participants would adopt in the measurement of an asset;

· cash flows and discount rates reflect only the factors allocated to the asset which was subject to measurement;

· discount rates reflect the assumptions which are in line with the cash flow assumptions;

· discount rates are consistent with the key economic factors relating to the currency in which the cash flows are denominated.

The fair value determination methodology developed by Santander Bank Polska S.A. Group provides for adaptation of the fair value measurement model to the characteristics of the financial asset subject to measurement. When determining the need for adaptation of the model to the features of the asset subject to measurement, Santander Bank Polska S.A. Group takes into account the following factors:

· approach to the measurement (individual/collective) given the characteristics of the instrument subject to measurement;

· whether a schedule of payments is available;

· whether the asset subject to measurement is still offered by Santander Bank Polska S.A. Group and whether the products recently provided to customers can be a reference group for that asset.

Other significant groups of financial instruments measured at fair value are all derivatives, financial assets held within a residual business model, debt investment financial assets held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets, and equity investment financial assets. These financial instruments are either measured with reference to a quoted market price for that instrument or by using a respective measurement model.

Where the fair value is calculated using financial-markets pricing models, the methodology is to calculate the expected cash flows under the terms of each specific contract and then discount these values back to a present value. These models use as their basis independently sourced market parameters including, for example, interest rate yield curves, securities and commodities prices, option volatilities and currency rates. Most market parameters are either directly observable or are implied from instrument prices.

In justified cases, for financial instruments whose carrying amount is based on current prices or valuation models, Santander Bank Polska S.A. Group takes into account the need to identify additional adjustments to the fair value of the counterparty credit risk.

The fair value measurement models are reviewed periodically.

A summary of the carrying amounts and fair values of the individual groups of assets and liabilities is presented in Note 46.

Estimates for legal claims

Santander Bank Polska S.A. Group raises provisions for legal claims in accordance with IAS 37. The provisions have been estimated considering the likelihood of unfavourable verdict and amount to be paid, and their impact is presented in other operating income and cost.

Details on the value of the provisions and the assumptions made for their calculation are provided in notes 36,47 and 49.

Due to their specific nature, estimates related to legal claims of mortgage loans in foreign currencies are described below.

Estimates of risk arising from mortgage loans in foreign currencies

Due to the revolving legal situation related to mortgage loans portfolio denominated and indexed to foreign currencies, and inability to recover all contractual cash flows risk materialisation, Group estimates impact of legal risk on future cash flows.

Gross book value adjustment resulting from legal risk is estimated based on a number of assumptions, taking into account:a specific time horizon and a number of probabilities such as:

· the probability of possible settlements and

· the probability of submitting claims by borrowers, and

· the probability in terms of the number of disputes

which are described in more details in note 47.

Legal risk is estimated individually for each exposure in the event of litigation and in terms of portfolio in the absence of such.

As explained in the accounting policies, Santander Bank Polska Group accounts for the impact of legal risk as an adjustment to the gross book value of the mortgage loans portfolio. If there is no credit exposure or its value is insufficient, the impact of legal risk is presented as a provision according to IAS 37.

The result of changes in legal risk is presented in a separate position in income statement “Cost of legal risk associated with foreign currency mortgage loans” and “Gain/loss on derecognition of financial instruments measured at amortised cost”.

In 2025, the Group recognized PLN 1,596,631 k as cost of legal risk related to mortgage loans in foreign currencies and PLN 47,213 k as a cost of signed settlements.

The Group will continue to monitor this risk in subsequent reporting periods.

Details presenting the impact of the above-mentioned risk on financial statements, assumptions adopted for their calculation, scenario description and sensitivity analysis are contained in notes 47 and 49, respectively.

2.7 Judgements that may significantly affect the amounts recognized in the financial statements

When applying the accounting principles, the management of Santander Bank Polska S.A. Group makes various judgements that may significantly affect the amounts recognized in financial statements.

Consolidation scope

The preparation of consolidated financial statements by Santander Bank Polska S.A. as a parent entity of Santander Bank Polska S.A. Group requires an extensive use of judgement and multiple assumptions as to the nature of entities in which the investment is made including, determination of whether Santander Bank Polska S.A. as a parent entity exercises control over the investee.

Santander Bank Polska S.A., being the parent entity, controls directly or indirectly an investee when:

· if has power over the investee;

· if has exposure or rights to variable returns from its involvement with the investee;

· if has the ability to use its power over the investee to affect the amount of it’s own financial results.

The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases.

The key judgments and assumptions regarding involvement in entities in which it holds half of the voting rights are set out below.

Santander Towarzystwo Funduszy Inwestycyjnych S.A.

The owners of Santander Towarzystwo Funduszy Inwestycyjnych S.A. (Santander TFI S.A.), i.e. Santander Bank Polska S.A. and Banco Santander S.A., are members of global Santander Group and hold an equal stake of 50% in the company’s share capital.

Santander Bank Polska S.A. exercises control over Santander TFI S.A. within the meaning of the International Financial Reporting Standard 10 (IFRS 10) because it has the practical ability to unilaterally direct the appropriate activities of the Santander TFI S.A. Furthermore, it significantly affects the company’s operations and returns as the major business partner and distributor of investment products. At the same time, through its ownership interest, Santander Bank Polska S.A. is exposed and has right to variable returns generated by Santander TFI S.A.

Considering the guidance provided in IFRS 10 par. B18, the Bank’s Management Board concluded that, having regard to legal requirements concerning Santander TFI S.A. and its operations, the Bank has a practical ability to unilaterally direct the relevant activities of Santander TFI S.A. even if it does not have a contractual right to do so.

The Bank can have a real impact on the composition of the Supervisory Board and through it – on the composition of the Management Board of Santander TFI S.A. and these governing bodies decide on the relevant activities of Santander TFI S.A.

It should therefore be concluded that by having power and right to variable returns (benefits), the Bank has control over Santander TFI S.A.

POLFUND - Fundusz Poręczeń Kredytowych S.A

The investment in POLFUND - Fundusz Poręczeń Kredytowych S.A., where 50% of the voting rights are held by the Santander Bank Polska S.A. on Annual General Meeting, in accordance with the best knowledge and judgement was classified, as an investment in an associate as the ownership structure does not allow Santander Bank Polska S.A. to control and to jointly-control the company.

The list of fully consolidated subsidiaries is presented in note 1 “Information about the issuer”.

Subsidiaries

Santander Bank Polska S.A. Group applies the acquisition method to account for acquisition of subsidiaries.

Associates

Associates are those entities in which Santander Bank Polska S.A. Group has significant influence, but are not subsidiaries, neither joint ventures.

They are accounted for in accordance with the equity method in consolidated financial statements.

Transactions eliminated on consolidation

Intragroup balances and any unrealised gains and losses or incomes (including dividends) and expenses arising from intragroup transactions, are eliminated in the preparation of consolidated financial statement.

Assessment whether contractual cash flows are solely payments of principal and interest

The key issue for Santander Bank Polska S.A. Group's business, is to assess whether the contractual terms of financial assets indicate the existence of certain cash flow dates, which are only the repayment of the nominal value and interest on the outstanding nominal value.

For the purposes of this assessment, ‘principal’ is defined as the fair value of the financial asset on initial recognition and ‘interest’ is defined as consideration for the time value of money, for the credit risk associated with the principal amount outstanding during a particular period of time and for other basic lending risks and costs (e.g. liquidity risk and administrative costs), as well as a profit margin.

In assessing whether the contractual cash flows are solely payments of principal and interest, Santander Bank Polska S.A. Group considers the contractual terms of the instrument. This includes assessing whether the financial assets contain a contractual term that could change the timing or amount of contractual cash flows such that it would not meet this condition. In making the assessment the Santander Bank Polska S.A. Group considers:

· contingent events that would change the amount and timing of cash flows,

· leverage features,

· prepayment and extension terms,

· terms that limit Santander Bank Polska S.A. Group’s claim to cash flows from specified assets (e.g. non-recourse asset arrangements),

· features that modify consideration for the time value of money.

A prepayment feature is consistent with the SPPI criterion if the prepayment amount substantially represents unpaid amounts of principal and interest on the principal amount outstanding, which may include reasonable compensation for early termination of the contract.

In addition, a prepayment feature is treated as consistent with this criterion if a financial asset is acquired or originated at a premium or discount to its contractual par amount, the prepayment amount substantially represents the contractual par amount plus accrued (but unpaid) contractual interest (which may also include reasonable compensation for early termination), and the fair value of the prepayment feature is insignificant on initial recognition.

Business Model Assessment

Business models at Santander Bank Polska S.A. Group are determined at a level that reflects how groups of financial assets are managed together to achieve a particular business objective. The business model does not depend on the intentions of the Santander Bank Polska S.A. Group management regarding a particular instrument, which is why the model is assessed at a higher level of aggregation.

All business models, quantitative and qualitative criteria used for business model assessment are described in p.2.8 regarding financial asset classification.

2.8 Material accounting policy information

With the exception of the changes described in point 2.4 and point 2.5, the Santander Bank Polska S.A. Group consistently applied the adopted accounting principles both for the reporting period for which the statement is prepared and for the comparative period.

Santander Bank Polska S.A. Group classifies fixed assets (or disposal groups) as held for sale when their carrying amount is expected to be recovered primarily through a sale transaction rather than through continued use. Fixed assets or disposal groups are measured at the lower of their carrying amount and their fair value less costs of sell.

For an asset (or disposal group) to be classified as held for sale, it must be available for immediate sale in its current condition, subject only to customary and standard terms and conditions, and the sale itself must be highly probable.

A sale is highly probable when:

• the appropriate level of management is committed to the sale plan for the asset (or disposal group) and an active program to find a buyer and complete the plan has been initiated,

• the asset (or disposal group) must be actively marketed for sale at a price that is reasonable with respect to its current fair value,

• the sale is expected to be recorded as completed within one year from the date of classification.

A discontinued operation is a part of the Santander Bank Polska S.A. Group's business that represents a distinct, significant line of business or geographic area of operations that has been disposed of or is held for sale or disposal, or is a subsidiary acquired solely for the purpose of resale.

Santander Bank Polska S.A. Group classifies an operation as discontinued upon disposal or when the operation meets the criteria for classification as held for sale. Where an operation is classified as discontinued, comparative figures for the income statement are restated as if the operation had been discontinued at the beginning of the comparative period.

The accounting policies have been applied consistently by Santander Bank Polska S.A. Group entities.

Foreign currency

Foreign currency transactions

The Polish zloty (PLN) is the functional currency of the units which are members of Santander Bank Polska S.A. Group.

Transactions in foreign currencies are translated at the foreign exchange rate ruling at the date of the transaction. Resulting from these transactions monetary assets and liabilities denominated in foreign currencies, are translated at the foreign exchange rate ruling at the balance sheet date. Non-monetary assets and liabilities denominated in foreign currencies, which are stated at historical cost, are translated at the foreign exchange rate ruling at the date of the transaction. Non-monetary assets and liabilities denominated in foreign currencies that are stated at fair value are translated to the reporting currency at the foreign exchange rates ruling at the dates that the fair values were determined. Foreign exchange differences arising on translation are recognised in profit or loss except for differences arising on retranslation of instruments of other entities measured at fair value through other comprehensive income, which are recognised in other comprehensive income.

Financial assets and liabilities

Recognition and derecognition

Initial recognition

Santander Bank Polska S.A. Group recognises a financial asset or a financial liability in its statement of financial position when, and only when, it becomes bound by contractual provisions of the instrument.

A regular way purchase or sale of financial assets is recognised and derecognised, as applicable, at the settlement date.

Derecognition of financial assets

Santander Bank Polska S.A. Group derecognises a financial asset when and only when, if:

· contractual rights to the cash flows from that financial asset have expired, or

· Santander Bank Polska S.A. Group transfers a financial asset, and such operation meets the derecognition criteria.

The Group excludes financial assets from the statement of financial position, inter alia, if they are invalidated, settled, written off, overdue, materially modified or uncollectible as a result of a final court judgment. The above-mentioned components are excluded from the statement of financial position as a result of the provisions recognised for them for expected credit losses or losses due to legal risk (in the case of cancellations of CHF loans).

Derecognition of financial liabilities

Santander Bank Polska S.A. Group shall remove a financial liability (or a part of a financial liability) from its statement of financial position when, and only when, it is extinguished — i.e. when the obligation specified in the contract is discharged or cancelled or expires.

Classification of financial assets and financial liabilities

Classification of financial assets

Classification of financial assets which are not equity instruments

Santander Bank Polska S.A. Group classifies financial asset that are not an equity instrument as subsequently measured at amortised cost or at fair value through other comprehensive income or fair value through profit or loss on the basis of both:

· the business model of Santander Bank Polska S.A. Group for managing the financial assets and

· the contractual cash flow characteristics of the financial asset (described in point 2.7).

A financial asset is measured at amortised cost if both of the following conditions are fulfilled:

· the financial asset is held in a business model whose purpose is to hold financial assets to collect contractual cash flows, and

· the contractual terms of a financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

A financial asset is measured at fair value through other comprehensive income if both of the following conditions are fulfilled:

· the financial asset is held in a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets, and

· the contractual terms of a financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

If a financial asset is not measured at amortised cost or at fair value through other comprehensive income, it is measured at fair value through profit or loss.

Classification of financial assets which are equity instruments

Santander Bank Polska S.A. Group measures the financial asset that is an equity instrument at fair value through profit or loss, unless Santander Bank Polska S.A. Group made an irrevocable election at initial recognition for particular investments in equity instruments to present subsequent changes in fair value in other comprehensive income.

Business models

Business models at Santander Bank Polska S.A. Group are determined at a level that reflects how groups of financial assets are managed together to achieve a particular business objective. The business model does not depend on the intentions of the Santander Bank Polska S.A. Group key management regarding a particular instrument.

The business model refers to how Santander Bank Polska S.A. Group manages its financial assets in order to generate cash flows. That is, the business model determines whether cash flows will result from:

· collecting contractual cash flows

· selling financial assets

· or both.

Consequently, the business model assessment is not performed on the basis of scenarios that Santander Bank Polska S.A. Group does not reasonably expect to occur, such as so-called “worst case” or “stress case” scenarios.

Santander Bank Polska S.A. Group determines the business model on the basis of the assessment of qualitative and quantitative criteria.

The qualitative criteria include, m.in, how the risks associated with these assets are managed and the principles of remunerating the persons managing these portfolios.

The quantitative criteria are intended to determine whether the sale of financial assets during the analysed period does not exceed the threshold values set in the internal regulations set in percentage terms. The frequency, value, timing of the sale of assets and reasons for the sale are analysed.

Business model types

The analysis of qualitative and quantitative criteria makes it possible to identify three basic business models applied in the operations of Santander Bank Polska S.A. Group:

· the business model whose objective is to hold assets in order to collect contractual cash flows (hold to collect),

· the business model whose objective is achieved by both collecting contractual cash flows and selling financial assets (hold to collect and sell),

· the other/ residual business model (the business model whose objective is achieved by selling assets).

The predominant business model in the Santander Bank Polska S.A. Group is a business model that involves holding assets for the purpose of generating contractual cash flows, with the exception of:

· debt instruments measured at fair value through other comprehensive income held in the ALM segment and loans and advances subject to the underwriting process described below, for which a business model has been established, the purpose of which is achieved both by generating cash flows arising from the agreement, as well as through the sale of financial assets,

· instruments held for trading, including debt instruments and derivatives, for which hedge accounting is not used – the appropriate business model is a different/residual business model.

A business model whose objective is to hold assets in order to collect contractual cash flows

In the hold-to-maturity model, incidental sales are possible. Such sales are each time analyzed in terms of frequency, value and distribution of sales in earlier periods, reasons for these sales and expectations as to future sales operations.

A business model whose objective is to hold assets in order to collect contractual cash flows spans the entire spectrum of credit activity, including but not limited to corporate loans, mortgage and consumer loans, credit cards, loans granted and debt instruments (e.g. treasury bonds, corporate bonds), which are not held for liquidity management purposes. Financial assets on account of trading settlements are substantially also recognised under this model. Such assets are recognised in the books of Santander Bank Polska S.A. Group on the basis of an invoice issued payable within maximum one year.

A business model whose objective is achieved by both collecting contractual cash flows and selling financial assets

A business model whose objective is achieved by both collecting contractual cash flows and selling financial assets includes:

· financial assets acquired for the purpose of liquidity management, such as State Treasury bonds or NBP bond and

· loans and advances subject to underwriting, i.e. portion of credit exposures that are planned to be sold before maturity for reasons other than increase in credit risk.

Other/ residual business model

Other, residual, model is used for classifying assets held by Santander Bank Polska S.A. Group but not covered by the first or second category of the business model. They include assets from the “held for trading” category in the financial statements, such as listed equity instruments, commercial bonds acquired for trading purposes and derivatives (e.g. options, IRS, FRA, CIRS, FX Swap contracts) which are not embedded derivatives.

Changing the business model

Santander Bank Polska S.A. Group reclassifies all affected financial assets when, and only when, it changes its business model for managing financial assets.

If Santander Bank Polska S.A. Group reclassifies a financial asset, reclassification occurs prospectively from the first day of the reporting period following the change.

Classification of financial liabilities

Santander Bank Polska S.A. Group classifies all financial liabilities as subsequently measured at amortised cost, except for:

· financial liabilities measured at fair value through profit or loss. Such liabilities, including derivatives that are liabilities, shall be subsequently measured at fair value.

· financial liabilities that arise when a transfer of a financial asset does not qualify for derecognition or when the continuing involvement approach applies;

· financial guarantee contracts. After initial recognition , the issuer shall measure contract at the higher of:

(1) amount of the expected credit loss allowance,

(2) initial recognised amount, less respective accumulated income recognised as per IFRS 15;

· commitments to provide a loan at a below-market interest rate. If the liability is not measured at fair value through profit or loss, the issuer shall subsequently measure it at the higher of:

(1) amount of the expected credit loss allowance,

(2) initial recognised amount, less respective accumulated income recognised as per IFRS 15;

· contingent consideration recognised by the acquire under the business combination arrangement governed by IFRS 3. Such contingent consideration shall subsequently be measured at fair value with changes recognised in profit or loss.

Embedded derivatives

For financial assets, that meet the definition of hybrid contracts with an embedded derivative, a derivative that is a component of such a contract is not separated from the host contract which is not a derivative, the entire contract is assessed in terms of the contractual cash flow characteristics.

Measurement of financial assets and financial liabilities

Initial measurement

At initial recognition, Santander Bank Polska S.A. Group measures a financial asset or financial liability at its fair value plus or minus, in the case of a financial asset or financial liability not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition or issue of the financial asset or financial liability.

However, if the fair value of the financial asset or financial liability at initial recognition differs from the transaction price, Santander Bank Polska S.A. Group recognises this instrument on that date as follows:

· when the fair value is evidenced by a quoted price in an active market for an identical asset or liability (i.e. a Level 1 input) or based on a valuation technique that uses only data from observable markets, then Santander Bank Polska S.A. Group recognises the difference between the transaction price and the fair value at initial recognition as a gain or loss.

· in all other cases, at the measurement adjusted to defer the difference between the fair value at initial recognition and the transaction price. After initial recognition, Santander Bank Polska S.A. Group recognises that deferred difference as a gain or loss only to the extent that it arises from a change in a factor (including time) that market participants would take into account when pricing the asset or liability.

At initial recognition, Santander Bank Polska S.A. Group shall measure trade receivables that do not have a significant financing component (determined in accordance with IFRS 15) at their transaction price (as defined in IFRS 15).

Subsequent measurement of financial assets

After initial recognition, Santander Bank Polska S.A. Group recognises a financial asset:

· at amortised cost, or

· fair value through other comprehensive income, or

· at fair value through profit or loss.

Allowances for expected credit losses are not calculated for financial assets measured at fair value through profit or loss.

Subsequent measurement of financial liabilities

After initial recognition, Santander Bank Polska S.A. Group recognises a financial liability:

· at amortised cost, or

· at fair value through profit or loss.

Liabilities measured at amortised costs include: deposits from banks, deposits from customers, liabilities due to repo transactions, loans and advances obtained, issued debt instruments and subordinated liabilities.

Liabilities are recognised as subordinated liabilities which in the event of liquidation or bankruptcy of Santander Bank Polska S.A. Group are repaid after satisfaction of claims of all other Santander Bank Polska S.A. Group’s creditors. Financial liabilities are classified as subordinated liabilities by the decision of the Polish Financial Supervision Authority issued at the request of Santander Bank Polska S.A. Group.

Amortised cost measurement

Financial assets

Effective interest method

Interest revenue is calculated by applying the effective interest rate to the gross carrying amount of financial assets and presented in “Net interest income”, except for credit-impaired financial assets. At the time a financial asset or a group of similar financial assets is reclassified to stage 3, interest revenue is calculated on the basis of a net value of a financial asset and presented at the interest rate used for the purpose of discounting the future cash flows for the purpose of measurement of impairment.

This does not apply to POCI assets, in the case of which the interest revenue is calculated on the basis of the net carrying amount, applying the effective interest rate adjusted for credit risk over the lifetime of the asset. The credit-adjusted effective interest rate is calculated by taking into account the future cash flows adjusted for the effect of credit risk over the lifetime of the asset.

The gross carrying amount of a financial asset is its amortised cost, before adjusting for any expected credit loss allowances.

Purchased or originated credit-impaired assets (POCI)

Santander Bank Polska S.A Group distinguished the category of purchased or originated credit-risk assets . POCI are assets that are credit-impaired on initial recognition. Financial asset that were classified as POCI at initial recognition should be treated as POCI in all subsequent periods until they are derecognized.

At initial recognition, POCI assets are recognized at their fair value. After initial recognition POCI assets are measured at amortized costs.

Valuation of POCI assets is based on the effective interest rate adjusted for the effect of credit risk .

For POCI assets (purchased or originated credit impaired) expected credit losses are recognised over the lifetime of the asset.

Portfolio of mortgage loans denominated/indexed to foreign currencies

Santander Polska S.A. Group reduces the gross carrying amount of mortgage loans denominated/indexed to foreign currencies in accordance with IFRS 9 by the impact of legal risk for potential and existing disputes. In the absence of gross carrying amount or its insufficient value to cover, it records a provision in accordance with IAS 37.

Modification of contractual cash flows

The concept of modification

Changes to the contractual cash flows in respect of the financial asset are regarded by Santander Bank Polska S.A. Group as modification if made in the form of an annex. Changes to the contractual cash flows arising from performance of the contractual obligations are not considered to be a modification.

If the terms of the financial asset agreement change, the Santander Bank Polska S.A. Group assesses whether the cash flows generated by the modified asset differ significantly from cash flows generated by financial asset before modification of the terms of the asset agreement.

Modification criteria

When assessing whether a modification is substantial or minor, Santander Bank Polska S.A. Group takes into account both quantitative and qualitative criteria. Both criteria groups are each time analyzed together.

Quantitative criteria

To determine the significance of the impact of modifications, the so-called "10% test" is carried out which is based on a comparison of discounted cash flows of the modified financial instrument (using the original effective interest rate) with discounted (also with the original effective interest rate) cash flows of the financial instrument before modification, whose value should correspond to the value of undue capital, increased by the value of undue interest and adjusted for the amount of unsettled commission.

Qualitative criteria

During the qualitative analysis, Santander Bank Polska S.A. Group takes into account the following aspects:

· adding / removing a feature that violates the contractual cash flow test result,

· currency conversion - except for currency conversions resulting from the transfer of the contract for collection,

· change of the main debtor - change of the contractor results in a significant modification of contractual terms and

· consolidation of several exposures into one under an annex.

Substantial modification

Identification of substantial modification resulting in the exclusion of a financial instrument from the statement of financial position is based on qualitative and quantitative criteria described above.

The occurrence of at least one of these quality criteria results in a significant modification. In the case of quantitative criteria, exceeding the "10% test" also indicates a significant modification.

As a result of a significant modification, the existing financial instrument is derecognized. The new instrument is recognized at fair value.

Minor modification

If neither the qualitative criteria, not the quantitative are met ( eg. “10% test” exceeded), the modification is regarded by Santander Bank Polska S.A. Group as insignificant.

The change in the gross carrying amount is recognized in interest income/expense as a modification gain or loss.

Write-off

Santander Bank Polska S.A. Group directly reduces the gross carrying amount of a financial asset when the entity has no reasonable expectations of recovering a financial asset in its entirety or a portion thereof. A write-off constitutes a derecognition event. Financial asset can be written off partially or in its entirety.

Santander Bank Polska S.A. Group writes off financial assets if at least one of the following conditions apply:

· Santander Bank Polska S.A. Group has documented the irrecoverability of the debt ;

· there are no reasonable expectations of recovering the financial asset in full or in part;

· the debt is due and payable in its entirety and the value of the credit loss allowance corresponds to the gross value of the exposure, while the expected debt recovery proceeds are nil;

· the asset originated as a result of a crime and the perpetrators have not been identified or

· Santander Bank Polska S.A. Group has received:

· a decision on discontinuation of debt enforcement proceedings due to irrecoverability of the debt (in relation to all obligors), issued by a relevant enforcement authority pursuant to Article 824 § 1 (3) of the Polish Code of Civil Procedure, which is recognised by the creditor (Santander Bank Polska S.A. Group) as corresponding to the facts; or

· a court decision:

- dismissing a bankruptcy petition, if the insolvent debtor's assets are insufficient to cover the cost of the proceedings or suffice to cover this cost only; or

- discontinuing the bankruptcy proceedings or

- closing the bankruptcy proceedings.

Financial assets written off are then recorded off balance sheet.

Impairment

General approach

Santander Bank Polska S.A. Group recognises allowances for expected credit losses in respect of:

· financial assets measured at amortised cost or at fair value through other comprehensive income;

· lease receivables;

· contract assets, i.e. the consideration to which Santander Bank Polska S.A. Group is entitled in exchange for the goods or services transferred to the customer in accordance with IFRS 15 Revenue from Contracts with Customers;

· loan commitments and

· off-balance sheet credit liabilities and financial guarantees.

Details regarding the calculation are described in point 2.6 "Allowances for expected credit losses"

Santander Bank Polska S.A. Group recognises in profit or loss, as an impairment gain or loss, the amount of expected credit losses that is required to adjust the loss allowance at the reporting date to the amount that is required to be recognised.

Santander Bank Polska S.A. Group charges interest on exposures classified in Stage 3 on the net exposure value .

Simplified approach for trade receivables and contract assets

In the case of trade receivables and contract assets, Santander Bank Polska S.A.Group always measures the loss allowance at an amount equal to lifetime expected credit losses for trade receivables or contract assets that result from transactions that are within the scope of IFRS 15, and that do not contain a significant financing component.

Contingent liabilities

Santander Bank Polska S.A. Group creates provisions for impairment risk-bearing irrevocable contingent liabilities (irrevocable credit lines, financial guarantees, letters of credit, etc.). The value of the provision is determined as the difference between the estimated amount of available contingent exposure set using the Credit Conversion Factor (CCF) and the current value of expected future cash flows under this exposure.

Santander Bank Polska S.A. Group raises provisions for off-balance sheet liabilities subject to credit risk, broken down into 3 stages.

Gains and losses

Financial instruments in amortized cost

A gain or loss on a financial asset that is measured at amortised cost and is not part of a hedging relationship is recognised in profit or loss through the amortisation process or in order to recognise impairment gains or losses. A gain or loss on a financial liability that is measured at amortised cost and is not part of a hedging relationship is recognised in profit or loss when the financial liability is derecognised and through the amortisation process.

With regard to the financial assets recognised by Santander Bank Polska S.A. Group at the settlement date, any change in the fair value of the asset to be received during the period between the trade date and the settlement date is not recognised for assets measured at amortised cost. For assets measured at fair value, however, the change in fair value is recognised in profit or loss or in other comprehensive income. The trade date means the date of initial recognition for the purposes of applying the impairment requirements.

Instruments measured at fair value

A gain or loss on a financial asset or liability measured at fair value is recognised in profit or loss unless the asset or liability is:

· a part of a hedging relationship,

· an investment into an equity instrument and Santander Bank Polska S.A. Group has decided to present gains and losses on that investment in other comprehensive income,

· a financial liability designated as measured at fair value through profit or loss and Santander Bank Polska S.A. Group is required to present the effects of changes in the liability's credit risk in other comprehensive income; or

· is a financial asset measured at fair value through other comprehensive income and Santander Bank Polska S.A. Group is required to recognise some changes in fair value in other comprehensive income.

Investments in equity instruments

Investments in equity instruments are measured at fair value through profit or loss unless at their initial recognition Santander Bank Polska S.A. Group makes an irrevocable election to present in other comprehensive income subsequent changes in the fair value of an investment in an equity instrument within the scope of this policy that is no held for trading.

If Santander Bank Polska S.A. Group has elected to measure equity instruments at fair value through other comprehensive income, dividends from that investment are recognised in profit or loss.

Liabilities designated as measured at fair value through profit or loss

Santander Bank Polska S.A. Group presents a gain or loss on a financial liability that is designated as measured at fair value through profit or loss as follows:

· the amount of change in the fair value of the financial liability that is attributable to changes in the credit risk of that liability is presented in other comprehensive income, and

· the remaining amount of change in the fair value of the liability is presented in profit or loss unless the treatment of the effects of changes in the liability's credit risk described in (a) would create or enlarge an accounting mismatch in the profit or loss of Santander Bank Polska S.A. Group.

If the requirements specified above would create or enlarge an accounting mismatch in the profit or loss of Santander Bank Polska S.A. Group, Santander Bank Polska S.A. Group presents all gains or losses on that liability (including the effects of changes in the credit risk of that liability) in profit or loss.

Santander Bank Polska S.A. Group presents in profit or loss all gains and losses on loan commitments and financial guarantee contracts that are designated as measured at fair value through profit or loss.

Assets measured at fair value through other comprehensive income

A gain or loss on a financial asset measured at fair value through other comprehensive income is recognised in other comprehensive income, except for impairment gains or losses and foreign exchange gains and losses, until the financial asset is derecognized. If the financial asset is derecognised, Santander Bank Polska S.A. Group accounts for the cumulative gain or loss that was previously recognised in other comprehensive income in profit or loss. Interest calculated using the effective interest method is recognised in profit or loss.

Financial instruments held for trading

Derivative financial instruments are recognised at fair value without any deduction for transactions costs to be incurred on sale. The best evidence of the fair value of a financial instrument at initial recognition is the transaction price i.e. the fair value of the consideration given or received.

If a hybrid contract contains a host contract that is not an asset within the scope of this IFRS 9, Santander Bank Polska S.A. Group separates the embedded derivative from the host contract and accounts for it as other derivatives if the economic characteristics and risks of the embedded derivative are not closely related to the economic characteristics and risks of the host contract and the host contract is not carried at fair value through profit or loss. Embedded derivatives are measured at fair value with changes recognised in the profit and loss account.

Hedge accounting

Pursuant to paragraph 7.2.21 of IFRS 9, Santander Bank Polska S.A. Group chose to continue to apply the hedge accounting requirements and hedging relationships arising from IAS 39.

The Santander Bank Polska S.A. Group uses derivative financial instruments among others to hedge its exposure to interest rate risks arising from Santander Bank Polska S.A. Group operational, financing and investment activities.

The Santander Bank Polska S.A. Group discontinues hedge accounting when:

· it is determined that a derivative is not, or has ceased to be, highly effective as a hedge;

· the derivative expires, or is sold, terminated, or exercised;

· the hedged item matures or is sold, or repaid;

· the hedging relationship ceases.

Fair value hedge

A fair value hedge is accounted for as follows: the gain or loss from remeasuring the hedging instrument at fair value (for a derivative hedging instrument) shall be recognised in profit or loss; and the gain or loss on the hedged item attributable to the hedged risk shall adjust the carrying amount of the hedged item and be recognised in profit or loss. This rule applies if the hedged item is otherwise measured at amortised cost or is a financial asset measured at fair value through other comprehensive income.

Cash flow hedge

A cash flow hedge is accounted for as follows: the portion of the gain or loss on the hedging instrument that is determined to be an effective hedge shall be recognised directly in other comprehensive income and the ineffective portion of the gain or loss on the hedging instrument shall be recognised in income statement.

Interest income and expenses on hedged and hedging instruments are recognised as net interest income.

Amounts recognised in ‘Other comprehensive income’ are reclassified to profit or loss during the period of time in which the hedged item affects the income statement.

If the hedging instrument expires or is sold or the hedge accounting relationship is terminated, Santander Bank Polska S.A. Group discontinues hedge accounting. All profits or losses on the hedging instrument pertaining to the effective hedge recognised in other comprehensive income remains an element of equity until the forecast transaction occurs, when it is recognised in income statement.

If the transaction is no longer expected to occur, the cumulative gain or loss relating to the hedging instrument recognised in other comprehensive income is reclassified to profit or loss.

Repurchase and reverse repurchase transactions

The Santander Bank Polska S.A. Group also generates/invests funds by selling/purchasing financial instruments under repurchase/reverse repurchase agreements whereby the instruments must be repurchased/resold at the previously agreed price.

Securities sold subject to repurchase agreements (“repo and sell-buy-back transaction”) are not derecognised from the statement of financial position at the end of the reporting period. The difference between sale and repurchase price is treated as interest cost and accrued over the life of the agreement.

Securities purchased subject to resale agreements (“reverse repo and buy-sell-back transactions”) are not recognised in the statement of financial position at the end of the reporting period. The difference between purchase and resale price is treated as interest income and accrued over the life of the agreement.

The principles described above are also applied by Santander Bank Polska S.A Group to transaction concluded as separate transaction of sale and repurchase of financial instruments but having the economic nature of repurchased and reverse repurchase transactions.

Property, plant and equipment

Owned fixed assets

Property, plant and equipment including those under operating leases, are stated at cost or deemed cost less accumulated depreciation and impairment losses.

Subsequent expenditure

Santander Bank Polska S.A. Group recognises in the carrying amount of property, plant and equipment the cost of replacing part of such an asset when that cost is incurred if it is probable that the future economic benefits embodied with the item will flow to Santander Bank Polska S.A. Group and the cost of the item can be measured reliably. All other costs are recognised in the income statement as an expense as incurred.

Depreciation

Depreciation is charged to the income statement on a straight-line basis over the estimated economic useful lives of each part of an item of property, plant and equipment.

The estimated economic useful lives are as follows:

· buildings: 22-40 years

· IT equipment: 3-5 years

· transportation means: 3-4 years

· other fixed assets: 3-14 years.

Right-of-use assets are depreciated on a straight basis overt the assets’s useful life.

Depreciation rates are verified annually. On the basis of this verification, depreciation periods might be changed.

Goodwill and Intangible assets

Goodwill

Goodwill as of the acquisition date measured as the excess of the consideration transferred over the net of the acquisition-date amounts of the identifiable assets acquired and the liabilities, contingent liabilities less impairment. Goodwill value is tested for impairment annually.

Licenses, patents, concessions and similar assets

Acquired computer software licenses are recognized on the basis of the costs incurred to acquire and bring to use the specific software.

Expenditures that are directly associated with the production of identifiable and unique software products controlled by Santander Bank Polska S.A. Group, and that will probably generate economic benefits exceeding expenditures beyond one year, are recognised as intangible assets.

Amortisation

Amortisation is charged to the income statement on a straight-line or degressive method (for intangible assets resulting from business combinations) over the estimated economic useful lives of intangible assets, which for the majority of intangibles equals to three years.

Amortisation rates are verified annually. On the basis of this verification, amortisation periods might be changed.

Leasing

Separating elements of the leasing contract

Lessee

Santander Bank Polska S.A. Group (the lessee) does not separate non-lease components from lease components, and instead accounts for each lease component and any associated non-lease components as a single lease component for each underlying asset class where it is not possible and where the share of non-lease components is not significant compared to total net lease payments.

Lessor

For a contract that contains a lease component and one or more additional lease or non-lease components, Santander Bank Polska S.A. Group (the lessor) allocates the consideration in the contract applying the provisions of the accounting policy in respect of revenue from contracts with customers.

Lease term

Santander Bank Polska S.A. Group determines the lease term as the non-cancellable period of a lease, together with both:

· periods covered by an option to extend the lease if the Santander Bank Polska S.A. Group (the lessee) is reasonably certain to exercise that option; and

· periods covered by an option to terminate the lease if the Santander Bank Polska S.A. Group (the lessee) is reasonably certain not to exercise that option.

The lease term is updated upon the occurrence of either a significant event or a significant change in circumstances.

Santander Bank Polska Group as the lessee

Recognition

At the commencement date, Santander Bank Polska Group (the lessee) recognises a right-of-use asset and a lease liability.

Recognition exemptions

Santander Bank Polska Group (the lessee) does not apply the recognition and measurement requirements arising from the accounting policy to:

· leases that have a leasing period of no more than 12 months at the start date; and

· leases for which the underlying asset is of low value (i.e. if the net value of a new asset is lower or equal to PLN 20,000).

In the case of short-term leases or leases for which the underlying asset is of low value, the Santander Bank Polska S.A. Group (the lessee) recognises the lease payments associated with those leases as an expense on a straight-line basis over the lease term.

Santander Bank Polska Group as the lessor

Classification of leases

Santander Bank Polska Group (the lessor) classifies each of its leases as either an operating lease or a finance lease.

A lease is classified as a finance lease if it transfers substantially all the risks and rewards incidental to ownership of an underlying asset. A lease is classified as an operating lease if it does not transfer substantially all the risks and rewards incidental to ownership of an underlying asset.

Lease classification is made at the inception date and is reassessed only if there is a lease modification.

Other items of the statement of financial position

Other trade and other receivables

Trade receivables and other receivables payable within 12 months from the origination are measured at the initial recognition at par due to the immaterial effect of discounting. Trade receivables and other receivables payable within 12 months are at the balance sheet day recognised in the amount of the required payment less impairment loss.

Credit risk-linked bonds issued

Santander Bank Polska Group issues credit-linked notes (CLNs) in connection with the securitization transactions described in Note 23, Information on Asset Securitization. The issued notes are measured at amortized cost because the default element embedded in the CLN meets the definition of a financial guarantee agreement and does not constitute an embedded derivative.

Trade payables and other liabilities

Other liabilities payable within 12 months from the initial recognition are measured at par due to the immaterial effect of discounting. Like other liabilities payable within 12 months, trade payables are recognised at the balance sheet day in the amount of the payment due.

Equity

Equity comprises capital and funds created in accordance with applicable law, acts and the Articless of Association. Equity also includes retained earnings and prior year losses carried forward.

Share capital is stated at its nominal value in accordance with the Articles of Association and the entry in the court register.

Supplementary capital is created from profit allocations and share issue premiums.

Reserve capital is created from profit allocations and may be earmarked for covering balance sheet losses or dividend payment.

The result of valuation of management share-based incentive program is included in reserve capital (IFRS 2.53).

The supplementary, reserve, general banking risk fund and share premium are presented jointly under category “Other reserve funds”.

Revaluation reserve is comprised of adjustments relating to the valuation of financial assets measured at fair value through other comprehensive income and adjustments relating to the valuation of effective cash flow hedges taking into account deferred tax and actuarial gains from estimating provision for retirement. The revaluation reserve is not distributable.

Except for own equity, non-controlling interests are also recognised in Santander Bank Polska S.A. Group capital.

On derecognition of all or part of financial assets measured at fair value through other comprehensive income the total effects of periodical change in the fair value reflected in the revaluation reserve are reversed. The value of a given financial asset measured at fair value through other comprehensive income is increased or decreased by the whole amount or an adequate portion of the impairment allowance made previously. The effects of the fair value changes are removed from the revaluation reserve with a corresponding change in the income statement.

The net financial result for the accounting year is the profit disclosed in the income statement of the current year adjusted by the corporate income tax charge.

Custody services

Income from custody services is an element of the fee and commission income. The corresponding customer assets do not form part of Santander Bank Polska S.A. Group’s assets and as such are not disclosed in the consolidated statement of financial position.

Capital payments (Dividends)

Own dividends for a particular year, which have been approved by the General Meeting of Shareholders but not paid at the at the end of the reporting period are recognised as dividend liabilities in “other liabilities” item.

Provisions

A provision is recognised when Santander Bank Polska S.A. Group has a present legal or constructive obligation as a result of a past event, and it is probable that an outflow of economic benefits will be required to settle the obligation. If the amount is material, provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability.

Santander Bank Polska S.A. Group recognizes provisions for legal risk in accordance with IAS 37 Provisions, Contingent Liabilities and Contingent Assets, where the estimated legal risk loss exceeds the gross value of the loan, and for settled loans.

Income statement

Net interest income

Santander Bank Polska S.A. Group presents the interest income recognised at the effective interest rate and credit-adjusted effective interest rate in separate lines of the income statement: “Interest income from financial assets measured at amortised cost” and “Interest income from assets measured at fair value through other comprehensive income”.

In turn, the interest income from financial assets which do not meet the contractual cash flows test is presented in line “Income similar to interest - financial assets measured at fair value through profit or loss”.

Net fee and commission income

Santander Bank Polska S.A. Group recognizes the fee and commission income that is not accounted for using the effective interest rate in such a manner so as to reflect the transfer of the goods or services promised to a customer in an amount reflecting the consideration to which it will be entitled in return for the goods or services in accordance with the 5 -stage model for recognizing income .

The Group identifies separate obligations to perform the service to which it assigns a transaction price. If the amount of remuneration is variable, the transaction price includes part or all of the variable remuneration to the extent that there is a high probability that there will be no refund of previously recognized revenues. Revenues equal to the transaction price are recognized when the service is performed or when it is performed by providing the customer with the promised good or service. The costs leading to the conclusion of the contract and the costs of performing the contract are activated and then systematically depreciated by the Group taking into account the period of transferring goods or services to the customer.

The significant commission income of the Santander Bank Polska S.A. Group includes:

1. Fee and commission income from loans includes fees charged by Santander Bank Polska Group in respect of reminders, certificates, guarantees, debt collection activities as well as commitment fees. Due to its nature, the majority of such income is taken to profit or loss on a one-off basis, i.e. when a specific operation is performed for a customer. Other income, such as a guarantee fee, is settled over time during the term of an agreement with a customer.

2. Fee and commission income from credit cards includes fees in respect of card issuance, ATM withdrawals, issuance of a new card, generation of a credit card statement or activation of optional credit card-related services. The vast majority of income is recognised at a specific point in time, i.e. when a specific operation is performed for a customer. Fees in respect of additional services related to credit cards are recognised over time.

3. Income from asset management is recognised in accordance with a 5-step model based on the value of assets provided to Santander Bank Polska Group for management. Pursuant to the agreements in place, Santander Bank Polska Group does not receive any upfront fees or additional commissions calculated after the end of the accounting year on the basis of factors beyond the Santander Bank Polska S.A. Group’s control.

Gain/loss on derecognition of financial instruments measured at amortised cost

In the event of derecognition of an asset measured at amortized cost, Santander Bank Polska S.A. Group in this position presents the difference in value between financial instruments. The value of this item for 2025 relates almost entirely to settlements concluded for the portfolio of mortgage loans in foreign currencies. Upon concluding a settlement with a customer, the Group loses its rights to the foreign currency instrument and a new PLN instrument is created. In addition to settlements for the mortgage portfolio, this item presents significant modifications to other instruments like individual and corporate loans.

Costs of legal risk of mortgage loans in foreign currencies

This income statement line presents the total impact of the legal risk of mortgage loans denominated/indexed to foreign currencies and concerns mainly changes in the amount of the adjustment for legal risk reducing the gross carrying amount of the exposure and/or changes in the amount of the provision for legal risk, and court judgments.

Net income on bancassurance

For the selected loan products, where linkage to the insurance product has been identified, the Santander Bank Polska S.A. Group splits realised income into a portion recognised as interest income according to effective interest rate method and a portion recognised as fee income. The Santander Bank Polska S.A. Group qualifies distributed insurance products as linked to loans in particular if the insurance product influences contractual provisions of a loan.

To determine what part of income is an integral part of the credit agreement recognised as interest income using effective interest rate, the Santander Bank Polska S.A. Group separates the fair value of the financial instrument offered and the fair value of the intermediation service of insurance product sold together with such instrument. The portion that represents an element of the amortised cost of the financial

instrument and the portion that represents remuneration for the agency services are split in proportion to the fair value of the financial instrument and the fair value of the agency service cost, respectively, relative to the sum of the two values.

The portion of income that is considered an agency fee for sales of an insurance product linked to a loan agreement is recognised by the Santander Bank Polska S.A. Group as fee income when the fee is charged for sales of an insurance product.

The Santander Bank Polska S.A. Group verifies the accuracy of the assumed allocation of different types of income at least annually.

Employee benefits

Short-term employee benefits

The Santander Bank Polska S.A. Group’s short-term employment benefits which include wages, bonuses, holiday pay and social insurance payments are recognised as an expense as incurred.

Long-term employee benefits

The Santander Bank Polska S.A. Group’s obligation in respect of long-term employee benefits is the amount of future benefits that employees have earned in return for their service in the current and prior periods. The accrual for retirement bonus is estimated using actuarial valuation method. The valuation of those provisions is updated at least once a year.

Equity-settled share-based payment transactions

For equity-settled share-based payment transactions, the entity measures the goods or services received, and the corresponding increase in equity, directly, at the fair value of the goods or services received, unless that fair value cannot be estimated reliably. If the Santander Bank Polska S.A. Group cannot estimate reliably the fair value of the goods or services received, the Santander Bank Polska S.A. Group measures their value, and the corresponding increase in equity, indirectly, by reference to the fair value of the equity instruments granted.

Vesting conditions included in the terms of the grant are not taken into account in estimating fair value except where those terms are dependent on market conditions. Non-market vesting conditions are taken into account by adjusting the number of awards included in the measurement of the cost of employee services so that ultimately, the amount recognised in the income statement reflects the number of vested awards.

The expense related to share based payments is credited to shareholder’s equity. Where the share based payment arrangements give rise to the issue of new shares, the proceeds of issue of the shares are credited to share capital (nominal amount) and share premium (if any) when awards are exercised.

Incentive Program

The Group has implemented an incentive program (Incentive Program VII) for selected groups of Group employees (in particular material risk takers - MRT and management staff not eligible for this MRT group), under which remuneration is paid to eligible employees through the free transfer of own shares of Santander Bank Polska S.A. The program is classified in accordance with IFRS 2 as a share-based payment program settled in equity instruments. Employees acquire the right to remuneration in the form of own shares of Santander Bank Polska S.A. depends on conditions not directly related to the market price of these shares. Detailed conditions are described in note 55. The Group recognizes the cost of the program during the vesting period in correspondence with equity. During the vesting period, it recognizes an amount for the goods or services received, using the best available estimate of the number of equity instruments that will vest. The Group adjusts these estimates, if necessary, if subsequent information indicates that the number of equity instruments that will vest differs from previous estimates.

In order to implement the program in the above formula, the Group, after an appropriate decision at the General Meeting, purchases an appropriate number of own shares from the market from investors and at the market price for the needs of a given settlement cycle of the incentive program.

Cash-settled share-based payment transactions

For cash-settled share-based payment transactions, the Santander Bank Polska S.A. Group measures the goods or services acquired and the liability incurred at the fair value of the liability. Until the liability is settled, the Santander Bank Polska S.A. Group remeasures the fair value of the liability at each reporting date and at the date of settlement, with any changes in fair value recognised in profit or loss for the period. The Santander Bank Polska S.A. Group recognises the services received, and a liability to pay for those services, as the employees render the service. The liability is measured, initially and at each reporting date until settled, at the fair value of the share appreciation rights, by applying an option pricing model, taking into account the terms and conditions on which the share appreciation rights were granted, and the extent to which the employees have rendered the service to that date.

Net trading income and revaluation

Net trading income and revaluation include profits and losses resulting from changes in fair value of financial assets and liabilities classified as held for trading that are measured at fair value through profit and loss. Interest cost and income related to the debt instruments are also reflected in the net interest income.

Dividend income

Dividends are taken to the income statement at the moment of acquiring rights to them by shareholders provided that it is probable that the economic benefits will flow to the Santander Bank Polska S.A. Group and the amount of income can be measured reliably.

Gain on disposal of subsidiaries, associates and joint ventures

Gain or loss on the sale of shares in subsidiaries is determined as the difference between the subsidiary’s net book value of assets, adjusted for the unwritten portion of goodwill, and the sale price.

Profit on the sale of interests in associates and joint ventures is the difference between the book value of the assets and the sale price.

Gains or loss on other financial instruments

Gains or loss on other financial instruments include:

· gains and losses on disposal of equity instruments and debt instruments classified to the portfolio of financial assets measured at fair value through other comprehensive income; and

· changes in the fair value of hedged and hedging instruments, including ineffective portion of cash flow hedges.

Santander Bank Polska S.A. Group uses fair value hedge accounting and cash flow hedge accounting. Details are presented in Note 43 “Hedge accounting”.

Other operating income and other operating costs

Other operating income and cost include the cost of provisions for legal risk excluding legal risk arising from mortgage loans in foreign currencies, as well as operating cost and income not directly related to the statutory activity of Santander Bank Polska S.A. Group, including i.e. revenues and cost from the sale and liquidation of fixed assets, revenues from the sale of other services, received and paid damages, penalties and fines.

Impairment losses on loans and advances

The line item “Net impairment losses on loans and advances” presents impairment losses on balance sheet and off-balance sheet exposures and the gains/losses on the sale of credit receivables.

Staff and general and administrative expenses

The “Staff expenses” line item presents the following costs:

· remuneration and social insurance (including pension benefit contributions);

· provisions for unused leaves;

· pension provisions;

· bonus provisions;

· the programme for variable components of remuneration paid to individuals holding managerial positions, a part of which is recognised as an obligation on account of share-based payment in cash, in accordance with IFRS 2 Share-Based Payment; and

· employee training and other salary and non-salary benefits for employees.

The line item “General and administrative expenses” presents the following costs:

· maintenance and lease of fixed assets;

· IT and telecommunication services;

· administrative activity;

· promotion and advertising;

· property protection;

· short term lease costs and low-value assets lease cost

· charges paid to the Bank Guarantee Fund, the Financial Supervision Authority, the National Depository of Securities;

· taxes and fees (property tax, payments to the National Fund for the Rehabilitation of the Disabled, municipal and administrative fees, perpetual usufruct fees);

· insurance;

· repairs not classified as fixed asset improvements.

Tax on financial institutions

Introduced by an act implemented on 1 February 2016, the tax on financial institutions is calculated on the excess of the entity’s total assets over the PLN 4 billion level; in the case of banks the excess results from the statement of turnover and balances at the end of each month. Banks are permitted to reduce the tax base by e.g. the value of own funds and the value of treasury securities. In addition, banks reduce the tax base by the value of assets purchased from the National Bank of Poland held as collateral for a refinancing credit facility granted by the latter. The tax rate for all tax payers in 2024 and 2025 is 0.0366% per month, and the tax is paid monthly by the 25th day of the month following the month it relates to.

Santander Bank Polska S.A. Group reports the tax charge under “Tax on financial institutions”, separately from the income tax charge.

3. Operating segments reporting

Presentation of information about business segments in Santander Bank Polska Group bases on management information model which is used for preparing of reports for the Management Board, which are used to assess performance of results and allocate resources. Operational activity of Santander Bank Polska Group has been divided into five segments: Retail Banking, Business & Corporate Banking, Corporate & Investment Banking, ALM (Assets and Liabilities Management) and Centre, and Santander Consumer (discontinued operation)[1]. They were identified based on customers and product types.

Profit before tax is a key measure which Management Board of the Bank uses to assess performance of business segments activity.

Income and costs assigned to a given segment are generated on sale and service of products or services in the segment, according to description presented below. Such income and costs are recognized in the profit and loss account for Santander Bank Polska Group and may be assigned to a given segment either directly or based on reasonable assumptions.

Interest and similar income split by business segments is assessed by Management Board of the Bank on the net basis including costs of internal transfer funds and without split by interests income and costs.

Settlements among business segments relate to rewarding for delivered services and include:

· sale and/or service of customers assigned to a given segment, via sale/service channels operated by another segment;

· sharing of income and costs on transactions in cases where a transaction is processed for a customer assigned to a different segment;

· sharing of income and cost of delivery of common projects.

Income and cost allocations are regulated by agreements between segments, which are based on single rates for specific services or breakdown of total income and/or cost.

Assets and liabilities of a given segment are used for the operational activity and may be assigned to the segment directly or on a reasonable basis.

Santander Bank Polska Group focuses its operating activity on the domestic market.

In 2025 customer resegmentation between business segments was introduced. Once a year, Santander Bank Polska Group carries out the resegmentation / migration of customers between operating segments which results from the fact that customer meets the criteria of assignment for different operating segment than before. This change is intended to provide services at the highest level of quality and tailored to individual needs or the scale of customer operations. Due to immaterial impact of resegmentation in results and balance sheet of particular segment, comparable data are not adjusted.

In 2025 isolation of staff costs from operating costs took place. Comparable data are adjusted accordingly.

[1] Due to the classification of Santander Consumer Bank S.A. as discontinued operations, the Group’s data in the consolidated income statement for the 12-month period ended 31 December 2024 have been restated while data presented in the Statement of Financial Position at 31 December 2024 have not been restated, in accordance with IFRS 5.

Due to the transaction of sales of Santander Consumer Bank S.A. shares, in 2025 reclassification of Santander Consumer Group to discontinued operation took place. Comparable data of Profit and Loss Statement are adjusted accordingly.

In the part regarding Santander Bank Polska, the cost of legal risk connected with the portfolio of FX mortgage were presented in Retail Banking segment. More details regarding the above provisions are described in the note 47.

The principles of income and cost identification, as well as assets and liabilities for segmental reporting purposes are consistent with the accounting policy applied in Santander Bank Polska Group.

Retail Banking

Retail Banking generates income from the sale of products and services to personal customers and small companies. In the offer for customers of this segment there are a wide range of savings products, consumer and mortgage loans, credit and debit cards, insurance and investment products, clearing services, brokerage house services, GSM phones top-ups, foreign payments and Western Union and private-banking services. For small companies, the segment provides, among others, lending and deposit taking services, cash management services, leasing, factoring, letters of credit and guarantees. Furthermore, the Retail Banking segment generates income through offering asset management services within investment funds and private portfolios.

Business & Corporate Banking

Business & Corporate Banking segment covers products and activities targeted at business entities, local governments and the public sector, including medium companies. In addition to banking services covering lending and deposit activities, the segment provides services in the areas of cash management, leasing, factoring, trade financing and guarantees. It also covers insourcing services provided to retail customers based on mutual agreements with other banks and financial institutions.

Corporate & Investment Banking

In the Corporate & Investment Banking segment, Santander Bank Polska Group derives income from the sale of products and services to the largest international and local corporations, including:

· transactional banking with such products as cash management, deposits, leasing, factoring, letters of credit, guarantees, bilateral lending and trade finance;

· lending, including project finance, syndicated facilities and bond issues;

· FX and interest rate risk management products provided to all the Bank’s customers (segment allocates revenues from this activity to other segments, the allocation level may be subject to changes in consecutive years);

· underwriting and financing of securities issues, financial advice and brokerage services for financial institutions.

Through its presence in the interbank market, segment also generates revenues from interest rate and FX risk positioning activity.

ALM and Centre

The segment covers central operations such as financing of other Group’s segments, including liquidity, interest rate risk and FX risk management. It also includes managing the Bank’s strategic investments and transactions generating income and/or costs that cannot be directly or reasonably assigned to a given segment.

Santander Consumer

This segment included activities of the Santander Consumer Group. Activities of this segment focused on selling products and services addressed to both individual and business customers. This segment focused mainly on loans products, i.e. car loans, credit cards, cash loans, installment loans and lease products. In addition, Santander Consumer segment included term deposits and insurance products (mainly related to loans products).

In accordance to sale transaction, the assets and liabilities of Santander Consumer Bank S.A. and its subsidiaries were classified as a group of assets and liabilities held for sale and as discontinued operations.

Due to the classification of Santander Consumer Bank S.A. as discontinued operations, the Group’s data in the consolidated income statement for the 12-month period ended 31 December 2024 have been restated while data presented in the Statement of Financial Position at 31 December 2024 have not been restated, in accordance with IFRS 5.

Details regarding transaction of sale Santander Consumer Bank S.A. were presented in Note 48.

Consolidated income statement by business segments**

1.01.2025-31.12.2025	Segment Retail Banking *	Segment Business and Corporate Banking	Segment Corporate& Investment Banking	Segment ALM and Centre	Total
Net interest income	8 688 306	2 445 298	781 200	788 022	12 702 826
incl. internal transactions	(4 960)	(16 401)	30 727	(9 366)	-
Fee and commission income	2 295 631	734 268	600 273	-	3 630 172
Fee and commission expense	(545 756)	(69 247)	(66 652)	-	(681 655)
Net fee and commission income	1 749 875	665 021	533 621	-	2 948 517
incl. internal transactions	399 727	235 079	(634 806)	-	-
Other income	(71 238)	52 391	296 540	76 785	354 478
incl. internal transactions	23 336	50 095	(68 155)	(5 276)	-
Dividend income	11 268	-	4 633	-	15 901
Staff costs	(1 555 292)	(505 194)	(268 643)	-	(2 329 129)
Operating costs	(1 286 367)	(272 869)	(286 346)	(83 748)	(1 929 330)
incl. internal transactions	-	-	-	-	-
Depreciation/amortisation	(456 429)	(90 170)	(52 128)	-	(598 727)
Impairment losses on loans and advances	(410 784)	(122 369)	(48 122)	(4 623)	(585 898)
Cost of legal risk associated with foreign currency mortgage loans	(1 596 631)	-	-	-	(1 596 631)
Share in net profits (loss) of entities accounted for by the equity method	110 686	-	-	3 771	114 457
Tax on financial institutions	(485 460)	(201 377)	(149 737)	-	(836 574)
Profit before tax	4 697 934	1 970 731	811 018	780 207	8 259 890
Corporate income tax					(1 726 776)
Profit for the period from continuing operations					6 533 114
Profit/(loss) for the period from discontinued operations					231 731
Profit for the period					6 764 845
Profit/(loss) for the period attributable to:
- owners of the parent entity					6 478 814
- non-controlling interests					286 031
Profit/(loss) for the period attributable to owners of the parent entity from:
- continuing operations					6 462 914
- discontinued operations					15 900
Profit/(loss) for the period attributable to owners of the parent entity					6 478 814

* Includes individual customers, small companies and Wealth Management (private banking and Santander TFI SA).

** The disclosed data are based on the information provided internally to the Management Board.

1.01.2025-31.12.2025	Segment Retail Banking *	Segment Business and Corporate Banking	Segment Corporate& Investment Banking	Segment ALM and Centre	Total
Fee and commission income	2 295 631	734 268	600 273	-	3 630 172
Electronic and payment services	197 441	74 104	32 665	-	304 210
Account maintenance and payment transactions	277 424	110 184	20 771	-	408 379
Asset management fees	346 322	490	590	-	347 402
Foreign exchange commissions	408 106	227 909	276 326	-	912 341
Credit commissions incl. factoring commissions and other	127 428	161 535	112 937	-	401 900
Insurance commissions	242 137	16 414	992	-	259 543
Commissions from brokerage activities	110 799	1 667	83 595	-	196 061
Credit cards	92 786	-	-	-	92 786
Card fees (debit cards)	441 820	21 291	2 329	-	465 440
Off-balance sheet guarantee commissions	9 067	113 919	46 395	-	169 381
Finance lease commissions	18 914	3 800	226	-	22 940
Issue arrangement fees	310	2 955	23 447	-	26 712
Distribution fees	23 077	-	-	-	23 077

* Includes individual customers, small companies and Wealth Management (private banking and Santander TFI SA).

1.01.2024-31.12.2024 represented**	Segment Retail Banking *	Segment Business and Corporate Banking	Segment Corporate& Investment Banking	Segment ALM and Centre	Total
Net interest income	8 219 476	2 344 599	777 899	928 440	12 270 414
incl. internal transactions	(3 507)	(8 470)	28 791	(16 814)	-
Fee and commission income	2 146 824	696 558	527 885	-	3 371 267
Fee and commission expense	(464 904)	(68 457)	(53 274)	-	(586 635)
Net fee and commission income	1 681 920	628 101	474 611	-	2 784 632
incl. internal transactions	390 698	206 911	(597 609)	-	-
Other income	(47 415)	71 100	287 832	(44 433)	267 084
incl. internal transactions	33 458	55 661	(84 550)	(4 569)	-
Dividend income	10 481	-	5 187	-	15 668
Staff costs	(1 444 231)	(460 354)	(260 490)	-	(2 165 075)
Operating costs	(1 191 752)	(232 428)	(254 506)	(65 792)	(1 744 478)
incl. internal transactions	-	-	-	-	-
Depreciation/amortisation	(421 964)	(78 762)	(41 267)	-	(541 993)
Impairment losses on loans and advances	(400 635)	(239 651)	(83 516)	(103)	(723 905)
Cost of legal risk associated with foreign currency mortgage loans	(2 252 561)	-	-	-	(2 252 561)
Share in net profits (loss) of entities accounted for by the equity method	100 443	-	-	1 854	102 297
Tax on financial institutions	(445 445)	(180 501)	(152 039)	-	(777 985)
Profit before tax	3 808 317	1 852 104	753 711	819 966	7 234 098
Corporate income tax					(1 893 772)
Profit for the period from continuing operations					5 340 326
Profit/(loss) for the period from discontinued operations					(95 529)
Profit for the period					5 244 797
Profit/(loss) for the period attributable to:
- owners of the parent entity					5 212 731
- non-controlling interests					32 066
Profit/(loss) for the period attributable to owners of the parent entity from:
- continuing operations					5 283 849
- discontinued operations					(71 118)
Profit/(loss) for the period attributable to owners of the parent entity					5 212 731

* Includes individual customers, small companies and Wealth Management (private banking and Santander TFI SA).

**Represented data presenting continued operations following the separation of the discontinued operations; details are presented in Note 48.

1.01.2024-31.12.2024 represented**	Segment Retail Banking*	Segment Business and Corporate Banking	Segment Corporate & Investment Banking	Segment ALM and Centre	Total
Fee and commission income	2 146 824	696 558	527 885	-	3 371 267
Electronic and payment services	192 032	73 604	30 184	-	295 820
Account maintenance and payment transactions	270 575	108 423	21 003	-	400 001
Asset management fees	291 069	550	595	-	292 214
Foreign exchange commissions	393 138	210 081	267 837	-	871 056
Credit commissions incl. factoring commissions and other	128 787	163 432	90 717	-	382 936
Insurance commissions	231 908	14 861	1 191	-	247 960
Commissions from brokerage activities	99 744	177	55 732	-	155 653
Credit cards	88 780	-	-	-	88 780
Card fees (debit cards)	417 538	21 650	2 266	-	441 454
Off-balance sheet guarantee commissions	2 790	99 495	42 671	-	144 956
Finance lease commissions	10 296	2 992	236	-	13 524
Issue arrangement fees	-	1 293	15 453	-	16 746
Distribution fees	20 167	-	-	-	20 167

* Includes individual customers, small companies and Wealth Management (private banking and Santander TFI SA).

**Represented data presenting continued operations following the separation of the discontinued operations; details are presented in Note 48.

Consolidated statement of financial position by business segments**

31.12.2025		Segment Retail Banking *	Segment Business and Corporate Banking	Segment Corporate& Investment Banking	Segment ALM and Centre	Total
Loans and advances to customers	96 395 223		46 684 947	19 757 554	-	162 837 724
Investments in associates	938 244		-	-	52 494	990 738
Other assets	10 442 281		2 736 940	22 622 731	108 519 663	144 321 615
Total assets	107 775 748		49 421 887	42 380 285	108 572 157	308 150 077
Deposits from customers	158 922 146		54 737 489	13 385 307	3 097 622	230 142 564
Other liabilities	2 770 932		479 747	10 098 826	29 152 782	42 502 287
Equity	9 125 777		5 648 590	3 333 320	17 397 539	35 505 226
Total equity and liabilities	170 818 855		60 865 826	26 817 453	49 647 943	308 150 077

* Includes individual customers, small companies and Wealth Management (private banking and Santander TFI SA).

**The disclosed data are based on the information provided internally to the Management Board.

31.12.2024	Segment Retail Banking *	Segment Business and Corporate Banking	Segment Corporate& Investment Banking	Segment ALM and Centre	Segment Santander Consumer	Total
Loans and advances to customers	91 962 332	43 021 156	20 920 878	-	18 871 915	174 776 281
Investments in associates	917 135	-	-	50 074	-	967 209
Other assets	10 237 155	2 638 887	13 990 910	94 873 199	6 890 279	128 630 430
Total assets	103 116 622	45 660 043	34 911 788	94 923 273	25 762 194	304 373 920
Deposits from customers	149 506 043	49 858 414	15 572 278	1 034 835	16 057 192	232 028 762
Other liabilities	2 039 413	445 779	7 891 161	22 133 957	5 393 662	37 903 972
Equity	8 476 341	5 321 716	3 075 074	13 256 715	4 311 340	34 441 186
Total equity and liabilities	160 021 797	55 625 909	26 538 513	36 425 507	25 762 194	304 373 920

* Includes individual customers, small companies and Wealth Management (private banking and Santander TFI SA).

4. Risk management

Santander Bank Polska Group is exposed to a variety of risks in its ordinary business activities. The objective of risk management is to ensure that the Group takes risk in a responsible and controlled manner when maximising the value for shareholders. Risk is a possibility of materialisation of events impacting the achievement of the Group’s strategic goals.

The primary objective of risk management at the bank and Santander Bank Polska Group is to conduct safe and efficient operations that generate profits and growth within established risk parameters. Risk management is defined by standards applicable in the banking sector and guidelines contained in regulations and recommendations of banking supervisory authorities.

Risk management at the bank and Santander Bank Polska Group is based on a risk profile, which results from the bank's overall risk appetite. The acceptable risk level (risk appetite)—expressed in the form of defined and quantified limits—is set in the "Risk Appetite Statement," adopted by the Management Board and approved by the Supervisory Board. Limits are set using stress tests and scenario analyses to ensure the stability of the bank's position even in the event of significantly adverse events. Based on the approved risk limits, observation limits are established and risk management policies are developed. Risk management policies are designed to identify and measure risk, define the most profitable return within the accepted risk level (risk-reward), and to continually set and verify appropriate risk mitigation limits. Santander Bank Polska Group modifies and develops risk management methods on an ongoing basis, taking into consideration changes in the Group’s risk profile, economic environment, regulatory requirements and best market practice.

Within the integrated risk management structure, dedicated organizational units responsible for risk identification, measurement, monitoring, and mitigation have been established, ensuring the independence of the risk management function from risk-taking units. The responsibilities of these units are defined by risk management policies, which regulate the process of identifying, measuring, and reporting risk levels and the regular setting of limits limiting the scale of exposure to individual risks. The Management Board and Supervisory Board set the course of action and actively support the risk management strategy. This is demonstrated through the adoption of the Risk Management Strategy and Risk Appetite, as well as the approval of key risk management policies, the participation of Management Board members in committees supporting risk management, risk reviews and approvals, and risk level reports.

The Supervisory Board continuously oversees the risk management system. The Supervisory Board approves the strategy, key risk management policies and risk appetite, and monitors the use of internal limits in relation to the current business strategy and macroeconomic environment. It conducts the reviews of the key risk areas, the identification of threats and the process of defining and monitoring remedial actions. The Supervisory Board assesses if the control activities performed by the Management Board are effective and aligned with the Supervisory Board’s policy. The assessment also includes the risk management system.

The Audit and Compliance Committee supports the Supervisory Board in fulfilment of its oversight obligations. The Committee performs annual reviews of the Group’s financial controls, and receives reports from the independent audit function and the compliance function. The Committee also receives regular quarterly reports on the degree of implementation of post-audit recommendations, and on that basis evaluates the quality of the actions taken. The Committee assesses the effectiveness of internal control system and risk management system. Moreover, the Committee's tasks include monitoring the performance of financial auditing activities and sustainable development reporting, in particular the audit and attestation carried out by the audit firm, controlling and monitoring the independence of the statutory auditor and the audit firm, and informing the Board about the results of the audit and attestation. In addition, the Committee develops the policy and procedure for selecting the audit company and to present to the Supervisory Board the recommendations on election, re-election and recalling of External Auditor as well as the entity authorized to attest sustainable development reporting and recommending to the Board the remuneration of the External Auditor for the performance of these services.

The Risk Committee supports the Supervisory Board in assessing the effectiveness of the internal control and risk management systems and measures adopted and planned to ensure an effective management of material risks.

Moreover,in the Bank the Supervisory Board is also supported by the Remuneration Committee and the Nominations Committee, however outside the risk management area.

The Management Board is responsible for the effectiveness of risk management. In particular, it introduces the organisational structure aligned with the level and profile of the risk being undertaken, split of the responsibilities providing the separation of the risk measurement and control function from the operational activity, implements and updates the written risk management strategies, and ensures transparency of the activities. The Management Board reviews the financial results of the Group. It established a number of committees which are directly responsible for the development of the risk management methodology and monitoring of risk levels in particular areas.

The Bank’s Management Board also manages the risk through its committees: the Risk Management Committee and the Risk Control Committee.

The Risk Management Committee (RMC) ratifies the key credit decisions (above specific decision-making thresholds), approves annual limits for securities trading and ALM transactions, and signs-off on the risk assessment models plan.

The Risk Control Committee monitors the level of risk in various areas of the Bank's operations and exercises control over all types of risk and risk management processes in the Group. It oversees the activities of lower-level risk management committees appointed by the Bank's Management Board.

The Risk Management Committee and the Risk Control Committee—operating within the remit designated by the Management Board—are directly responsible for developing risk management methods and monitoring risk levels in specific areas.

The Risk Control Committee oversees the activities of the following committees operating in the area of risk management:

Credit Risk Committee, which approves and supervises the risk management policy and risk measurement methodology as well as monitors credit risk of consolidated credit portfolio or in cases pertaining to more than one business segmenty;

Credit Policy Forum for Retail Portfolios/ SME Portfolios/ Business and Corporate Loans Portfolios, which are authorised to approve and supervise the the risk measurement policy and methodology, and monitoring credit risk only in relation to their respective business segments.

The Credit Committee takes credit decisions within the assigned lending discretions.

The Provisions Committee which takes decisions on impairment charges in an individual and collective approachfor credit exposures, as well as other financial instruments and assets and on legal risk provisions. Moreover, the Committee monitors credit loss allowances, reviews the adequacy of parameters applied when setting the impairment in an individual and collective approach for Santander Bank Polska Group, excluding Santander Consumer Bank S.A., and takes decisions about debts sales.

The Recovery Committee takes decisions as to the dealing with borrowers in distress, including with respect to the relationship management strategy, approval of the causes of loss analysis and monitoring of the portfolio and effectiveness of recovery processes.

Market and Investment Risk Committee, which approves and supervises the risk management policy and risk measurement methodology as well as monitors market risk in the banking book, market risk in the trading book, structural risk for the balance sheet, liquidity risk and investment risk;

Model Risk Management Committee, which is responsible for model risk management as well as supervises the methodology of models used in Santander Bank Polska S.A. Group;

The Information Management Committee is responsible for the quality and organisation of data related to risk management and other areas of the bank’s operations.

The Operational Risk Management Committee (ORMCo) monitors the level, sets the direction for strategic operational risk actions in Santander Bank Polska Group in the area of business continuity, information security and fraud prevention.

Suppliers Panel establishes standards and carries out monitoring regarding providers and services, incl. outsourcing; main forum for discussion on risk resulting from the cooperation with suppliers.

The Assets and Liabilities Management Committee supervises the activity on the bank’s and the Group’s banking book, manages liquidity and interest rate risk in the banking book and is responsible for the funding and balance sheet management, including for the pricing policy.

Liquidity Forum monitors liquidity position of the Bank, with a special focus on the dynamics of deposit and credit volumes, the Bank’s needs for financing and the general market situation.

The Capital Committee is responsible for capital management, in particular the ICAAP.

The Disclosure Committee verifies if the financial information published by Santander Bank Polska Group meets the legal and regulatory requirements.

The Local Marketing and Monitoring Committee approves new products and services to be implemented in the market, taking into account the reputation risk analysis.

The Compliance Committee is responsible for setting standards with respect to the management of compliance risk and the codes of conduct adopted by the Group.

The ESG Committee is the main forum to discuss issues concerning responsible banking, sustainable development, ESG and corporate culture. It sets the direction of strategic activities and monitors the related objectives. The Committee sets the strategy, standards and manages ESG and responsible banking issues at the Bank. As part of the Committee, the ESG Forum has been established to analyse challenges, opportunities and risks related to the EU Sustainable Finance agenda, including ESG risks, plan activities and coordinate their implementation at the Bank, and to submit regular reports to the Responsible Banking and Corporate Culture Committee and the Bank’s Management Board.

The ESG Panel is an inter-departmental panel of experts supporting business segments of Santander Bank Polska S.A. Group in correctly identifying and classifying transactions, products and services as sustainable, i.e. compliant with the requirements of the EU Taxonomy and SFICS, or having other environmental, social or sustainability-related attributes, in order to prevent the risk of greenwashing.

The chart below presents the corporate governance in relation to the risk management process.

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The Bank has dedicated committees which are convened in crisis situations:

Gold Committee, which takes decisions in crisis situations affecting Santander Bank Polska Group: it recommends the Management Board to activate the Recovery Plan, activates liquidity and capital contingency plans, and activates business continuity plans and the communication plan (if not already implemented).

Silver Committee, the main special situations governance body following the activation of the contingency situation, which assesses the impact of that situation and coordinates activities as part of the special situation management, activates action plans (e.g. business continuity plans) and BAU restoration procedures, and draws lessons learned after the special situation is resolved.

Bronze Group, which is responsible for the identification of and prompt response to threats or events that may pose a risk to the normal functioning of the Subsidiary and/or the Group. It identifies new threats in cooperation with the committees which manage risks on a daily basis.

Risk management is in line with the risk profile resulting from risk. At Santander Bank Polska Group, risk appetite is expressed as quantitative limits and captured in the “Risk Appetite Statement” adopted by the Management Board and approved by the Supervisory Board. Those limits are used to set watch limits and shape risk management policies.

The Group continuously analyses the risks, identifies their sources, creates the relevant risk management mechanisms including among others the measurement, control, mitigation and reporting. The key risks the Group is exposed to include:

· credit risk

· concentration risk

· market risk in the banking book and trading book

· liquidity risk

· operational risk,

· compliance risk.

The key rules, roles and responsibilities of the Group companies are set out in relevant internal policies relating to the management of individual risk types.

Santander Bank Polska Group pays special attention to the consistency of risk management processes across the Group, which ensures adequate control of the risk exposure. The subsidiaries implement risk management policies and procedures reflecting the principles adopted by Santander Bank Polska Group.

Acting under the applicable law, the bank exercises oversight of risk management in Santander Consumer Bank S.A. in line with the same oversight rules as applied to other Santander Bank Polska Group companies. The bank’s representatives on the Supervisory Board of Santander Consumer Bank S.A. are: the Management Board member in charge of the Risk Management Division and the Management Board member in charge of the Retail Banking Division they are responsible for supervision over Santander Consumer Bank S.A. and they ensure, together with the company’s Supervisory Board, that the company operates in line with adopted plans and operational security procedures. The bank monitors the profile and level of Santander Consumer Bank S.A. risk via risk management committees of Santander Bank Polska S.A.

From the point of view of negative impact of those risks on society, environment, employees, human rights and anti-corruption measures, particular importance is attached to operational risk, compliance risk and reputational risk. In addition, the bank has identified social and environmental risks (including climate risks) related to financing customers from sensitive sectors.

Credit risk

Santander Bank Polska Group’s credit activities focus on growing a high quality loan book with a good quality, a good yield and customer satisfaction.

Credit activity includes all products subject to credit risk (credit facilities), originated by the Bank or its leasing and factoring subsidiaries.

Credit risk is defined as the possibility of suffering a loss as a result that a borrower will fail to meet its credit obligation, including interest and fees. Credit risk arises from the impairment of credit assets and contingent liabilities, resulting from worsening of the borrower’s credit quality. Credit risk measurement is based on the estimation of credit risk weighted assets, with the relevant risk weights representing both the probability of default and the potential loss given default of the borrower.

Credit risk in Santander Bank Polska Group arises mainly from lending activities on the retail, SME, business, corporate segments and interbank markets. This risk is manager as part of the policy approved by the Management Board on the basis of the adopted credit procedures as well as on the basis of discretionary limits allocated to individual credit officers based on their knowledge and experience. The Group’s internal system of credit grading and monitoring allows for an early identification of likely defaults that might impair the loan book. Additionally, the Group uses large set of credit risk mitigation tools, both collaterals (financial and non-financial) and specific credit provisions and clauses (covenants).

The Group continues to develop and implement risk based methods of grading loans, allocating capital and measuring returns. Risk valuation models are used for all credit portfolios.

The Group regularly reviews processes and procedures for measurement, management and monitoring of the Bank’s credit portfolio risk, adjusting them to the amended laws and regulatory requirements, especially to the KNF recommendations and the EBA guidelines.

Impact of the geopolitical situation (including the conflict in Ukraine) on credit risk measurement

In 2025, the Group continued to thoroughly analyse developments in the macroeconomic environment and monitored credit exposures in individual customer segments and sectors in order to promptly and duly align the credit policy parameters where required.

In 2025, the Group focused on the analysis of potential impact of the geopolitical situation, the impact of increasing uncertainty, the risk of deglobalization and changing macroeconomic environment on customers’ standing across individual customers segments and economic sectors. The analysis of macroeconomic factors covered in particular inflation and interest rates, exchange rates, labour cost as well as gas and energy prices. The Group closely monitored risk indicators of individual credit portfolios and analysed the sensitivity of customers’ risk profile to changes in the economic and geopolitical environment. In addition, credit portfolios were stress tested in terms of the impact of individual factors and their combination. Additionally, draft legislative changes that may have a significant impact on the situation in individual sectors were monitored, resulting in appropriate, pre-emptive regulatory actions being taken on the portfolio. The Group closely monitored the portfolio of customers doing business in Ukraine, Russia, Belarus or Israeli and/or cooperating with companies from those countries. These risks were reflected through modifications to the ratings of entities, which directly translated into the level of provisions for expected credit losses. An appropriate strategy was applied to identified clients.

The overall quality of the credit portfolio is still assessed as satisfactory.

As part of regular reviews of ECL parameter models, the Group takes into account the latest macroeconomic projections, using its predictive models based on historical observations of relationships between those variables and risk parameters. ECL parameters were last updated in Q4 2024 to account for the impact of the geopolitical situation on the current economic situation and macroeconomic projections. The values of macroeconomic indicators included in the calculation of ECLs are presented in section ‘Allowances for expected credit losses in respect of financial assets’.

Credit risk management committees

Consolidated credit risk oversight at Santander Bank Polska Group is performed by the Credit Risk Committee (CRC). Its key responsibilities include development and approval of the best sectoral practice, industry analyses, credit policies, individual credit discretion systems and risks grading systems. The CRC also receives advanced credit portfolio analyses and recommends to the Management Board credit risk appetite limits to ensure balanced and safe growth of the credit portfolio.

The Bank also has three committees referred to as Credit Policy Forums, which deal with the key customer segments: retail segment, SME segment and the business/ corporate segment. These committees are responsible for shaping the credit policy and processes within their respective segments. If needed, their decisions may be escalated to the Credit Risk Committee.

In turn, oversight over credit risk models and the risk valuation methodology is the responsibility of the Models Risk Management Committee.

Risk Management Division

The Risk Management Division is responsible for a consolidated credit risk management process, including management and supervision of credit delivery, defining credit policies, providing decision-making tools and credit risk measurement tools, quality assurance of the credit portfolio and provision of reliable management information on the credit portfolio.

Credit Policies

Credit policies refer to particular business segments, loan portfolios and banking products. They contain guidelines for the identification of the areas where specific types of risks manifest themselves, specifying the methods of their measurement and mitigation to the level acceptable to the bank (e.g. “Loan-to-Value” ratios, FX risk in the case of foreign currency loans).

The Group reviews and updates its credit policies on a regular basis, aiming to bring them in line with the Group’s strategy, current macroeconomic situation, legal developments and changes in regulatory requirements.

Credit Decision Making Process

As part of risk management, the credit decision making process is based upon individual credit discretions commensurate with employees’ knowledge and experience in relation to individual business segments. Exposures in excess of PLN 50m are referred to the Credit Committee composed of senior managers. Transactions above stated thresholds (from PLN 85m to PLN 920m), depending on the transaction type) are additionally signed off by the Management Board’s Risk Management Committee.

The Group strives to provide credit service of the highest quality while satisfying the borrowers’ expectations and ensuring security of the credit portfolio. To this end, the existing system of credit discretions ensures segregation of the credit risk approval function from the sales function.

Credit Grading

Santander Bank Polska Group develops its credit risk assessment tools, adapting them to the KNF’s guidelines, International Accounting Standards/ International Financial Reporting Standards (IAS/IFRS) and best market practice.

The Group uses credit risk grading models for most credit portfolios, including corporate customers, SMEs, home loans, property loans, cash loans, credit cards and personal overdrafts.

The Group monitors credit grading in accordance with the rules described in the lending manuals. Additionally, for selected models, credit grade is automatically verified based on the number of days past due or an analysis of behavioural factors. Credit grade is also verified at subsequent credit assessments.

Credit Reviews

The Group performs regular reviews to determine the actual quality of the credit portfolio, confirm that adequate credit grading and provisioning processes are in place, verify compliance with the procedures and credit decisions and to objectively assess professionalism in credit management. The reviews are performed by the two specialised units: Non-Retail Process Control Office and the Department of Financial Crime Control and Prevention which are independent of the risk-taking units.

Collateral

In the Group’s security model, the Collateral and Credit Agreements Department is the central unit responsible for creation and maintenance of securities. The Security Manual as a procedure describing legal standards for the application of collateral security is managed by the Legal and Compliance Division. The Collateral and Credit Agreements Department is the owner of the security contract templates.

The role of the department is to ensure that security covers are duly established and held effective in line with the lending policy for all business segments. The unit is also responsible for developing standardised internal procedures with respect to perfecting and maintaining validity of collateral as well as ensuring that establishment, monitoring and release of security covers is duly effected.

Furthermore, the Collateral and Credit Agreements Department provides assistance to credit units in credit decision making and development of credit policies with respect to collateral. The unit gathers data on collateral and ensures appropriate management information. The tables below show types of collateral that can be used to secure loans and advances to customers from non-banking sector.

Retail customers

Type of loan/receivables	Type of collateral
Cash loan	bills, guarantees, credit insurance
Credit on liquid assets	guaranty deposit, amounts frozen on account, investment funds
Student loan	sureties
Housing loan	mortgage, credit insurance, transfer of claim
Leasing	bills, guarantees, transfer of rights to bank’s account; court registered pledge on movables; transfer of ownership, mortgage, obligation of the leased asset supplier to buy the asset back (buy-back guarantee)

Business customers

Type of loan/receivables	Type of collateral
Commercial credit	guaranty deposit, registered pledge, bills
Revolving credit	assignment of credit, bills, guarantees, registered pledge
Building credit	mortgage
Investment credit	mortgage, sureties, warranty
Granted and with supplements	guarantees, warranty
Leasing	bills, guarantees, transfer of rights to bank’s account; court registered pledge on movables; transfer of ownership, mortgage, obligation of the leased asset supplier to buy the asset back (buy-back guarantee)

Collateral management process

Before a credit decision is approved, in the situations provided for in internal regulations, the Collateral and Credit Agreements Department assesses the collateral quality and value, a process that includes:

· verification of the security valuation prepared by external valuers, and assessment of the security value for business loans,

· assessment of the legal status of the security for business loans,

· assessment of the investment process for the properties,

· seeking legal advises on the proposed securities.

The Collateral and Credit Agreements Department actively participates in credit processes, executing tasks including:

· verification of signed collateral documentation received from law firms, whether complete and compliant with the Bank’s internal procedures (verification carried out before or immediately after disbursement);

· registration and verification of the data in information systems,

· collateral monitoring and reporting,

· reporting on the status of collateral by segments

· releasing of the security.

In managing its receivables, Santander Bank Polska Group carries out the process of collateral execution. Selection of proper action towards execution of specific collateral depends on the type of the collateral (personal or tangible). In principle the Group aims at voluntary proceedings in the course of collateral execution. When there is no evidence of cooperation with a collateral provider, the Group’s rights are fulfilled in compliance with the law and internal regulations in the bankruptcy and enforcement proceedings.

Financial effect of the collateral

The financial effect of the accepted collateral was calculated as a change in the credit loss allowance as a result of exclusion of the cash flow from collateral (non-performing exposures are assessed on an case-by-case basis). For other portfolios (mortgage, SME and corporate loans), this effect was calculated by adjusting the LGD parameter to the level observed for particular clients on unsecured products.

The table below present financial effect of collateral of Santander Bank Polska Group as at 31.12.2025:

31.12.2025

Financial effect of collateral	Gross Amount	Allowance for impairment	Financial effect of collateral
Loans and advances to customers
individuals	23 027 273	(1 318 632)	-
housing loans	56 716 404	(344 097)	(698 006)
business	70 968 897	(1 998 999)	(1 076 204)
Total balance sheet	150 712 574	(3 661 728)	(1 774 210)
Total off-balance sheet	55 368 139	(79 330)	(61 880)

The table below present financial effect of collateral of Santander Bank Polska Group as at 31.12.2024:

31.12.2024
Financial effect of collateral	Gross Amount	Allowance for impairment	Financial effect of collateral
Loans and advances to customers
individuals	32 819 721	(2 397 731)	( 5 244)
housing loans	55 931 181	(416 229)	( 871 300)
business	69 736 432	(2 214 157)	(1 284 473)
Total balance sheet	158 487 334	(5 028 117)	(2 161 017)
Total off-balance sheet	46 005 445	(93 919)	(46 047)

Credit risk stress testing

Stress testing is a part of the credit risk management process used to evaluate potential effects of specific events or movement of a set of financial and macroeconomic variables or change in risk profile on Santander Bank Polska Group’s condition. Stress tests are composed of assessment of potential changes in credit portfolio quality when faced with adverse conditions. The process also delivers management information about adequacy of agreed limits and internal capital allocation.

Impairment calculation

Santander Bank Polska Group makes impairment allowances in accordance with International Financial Reporting Standard 9 (IFRS 9). IFRS 9 introduced a new approach to the estimation of allowances for credit losses. The approach is based on estimation of the expected credit loss (ECL). ECL allowances reflect an unbiased and probability-weighted amount that is determined by evaluating a range of possible outcomes, the time value of money; and reasonable and supportable information that is available without undue cost or effort at the reporting date about past events, current conditions and forecasts of future economic conditions. ECL allowances are measured at an amount equal to a 12-month ECL or the lifetime ECL, when it is deemed there has been a significant increase in credit risk since initial recognition. Accordingly, the ECL model gives rise to measurement uncertainty, especially in relation to:

· measurement of a 12-month ECL or the lifetime ECL;

· determination of when a significant increase in credit risk occurred;

· determination of any forward-looking events reflected in ECL estimation, and their likelihood.

In accordance with IFRS 9, the recognition of expected credit losses will depend on changes in risk after recognition of the exposure. The standard introduces three main stages for recognising expected credit losses:

· Stage 1 – exposures with no significant increase in risk since initial recognition, i.e. the likelihood of the exposure being downgraded to the impaired portfolio (Stage 3 exposures) has not increased. For such exposures, 12-month expected credit losses will be recognised.

· Stage 2 – exposures with a significant increase in risk since initial recognition, but with no objective evidence of default. For such exposures, lifetime expected credit losses will be recognised.

· Stage 3: exposures for which the risk of default has materialised (indications of impairment have been identified). For such exposures, lifetime expected credit losses will be recognised.

The basis for classification into stages are described in Note 2.6.

Lifetime expected losses are recognised also for the exposures classified as POCI (purchased or originated credit-impaired). Such an asset is created when an impaired asset is recognized, and the POCI classification is maintained throughout the life of the asset.

In the case of classification into stage 3, the Group applies objective indications of impairment, as defined in accordance with the Basel Committee’s recommendations and Recommendation R from KNF and EBA.

The rules for including past due in the identification of default are in line with the EBA Guidelines on the application of the definition of default and with the Regulation of the Minister of Finance, Investments and Development on the materiality level of past due credit obligations.

The Group estimates ECL using both an individual approach (for individually significant exposures with objectively evidenced impairment [stage 3]) and collective approach (individually insignificant exposures with objectively evidenced impairment, and incurred but not reported losses).

The Group on a regular basis recalibrates its models and updates the forward-looking information used for estimating ECL, taking into account the impact of changes in economic conditions, modifications of the Group’s credit policies and recovery strategies, which is designed to ensure appropriate level of impairment allowances.

The tables below present Santander Bank Polska Group’s exposure to credit risk.

Assets have been classified into respective risk grades based on the one-year probability of default arising from current credit rating (business customers) or score (personal customers) used for the purpose of business processes or, if not available, based on the one-year probability of default used for calculation of expected credit losses.

The tables below present the quality of financial assets of Santander Bank Polska Group broken down into risk groups as at 31.12.2025 and in the comparative period. The portfolio consists of loans and advances to clients and leasing portfolio.

31.12.2025			Loans and advances to individuals			Loans and advances to individuals- mortgage loans			Loans and advances to enterprises and lease receivables
	PD range at recognition date		Balance sheet exposures gross		Off-balance sheet exposures	Balance sheet exposures gross		Off-balance sheet exposures	Balance sheet exposures gross		Off-balance sheet exposures
Stage 1	from 0,00% to <0,15%		909 510		2 354 209	40 855 583		1 002 695	3 895 646		21 413 812
	from 0,15% to <0,25%		1 491 232		157 076	938 965		71 747	6 798 969		8 320 093
	from 0,25% to <0,50%		649 141		1 396 983	5 180 637		45 912	22 648 562		11 242 572
	from 0,50% to <0,75%		757 164		15	1 349 389		-	11 197 176		10 134 046
	from 0,75% to <2,50%		9 512 583		478 625	1 621 978		7 767	20 318 264		7 967 519
	from 2,50% to <10,0%		2 955 568		55 362	364 144		1 411	5 352 530		2 191 003
	from 10,0% to <45,0%		361 443		10 982	692		-	849 608		22 083
	from 45,0% to <100,0%		3 451		-	-		-	11 451		-
	Total Stage 1		16 640 092		4 453 252	50 311 388		1 129 532	71 072 206		61 291 128
Stage 2	from 0,00% to <0,15%		202 831		27 577	4 079 064		-	23 404		287
	from 0,15% to <0,25%		1 248 282		42 498	76 640		-	381 702		16 345
	from 0,25% to <0,50%		117 374		-	792 022		-	1 060 779		23 088
	from 0,50% to <0,75%		158 140		212 616	188 439		126	874 568		90 143
	from 0,75% to <2,50%		1 926 427		84 467	268 786		8 935	1 848 200		405 372
	from 2,50% to <10,0%		814 666		35 329	120 883		78 423	1 573 543		647 504
	from 10,0% to <45,0%		233 515		151	3 820		76	1 222 720		41 817
	from 45,0% to <100,0%		35 244		-	311		-	30 000		-
	Total Stage 2		4 736 479		402 638	5 529 965		87 560	7 014 916		1 224 556
		Default period		EAD after credit risk mitigation and credit conversion factor applied
				Loans and advances to individuals			Loans and advances to individuals- mortgage loans			Loans and advances to enterprises and lease receivables
Stage 3		up to 12 months		939 902			234 428			1 022 549
		from 13 to 24 months		419 454			126 364			1 061 734
		from 25 to 36 months		248 179			140 932			553 071
		from 37 to 48 months		125 455			91 239			198 182
		from 49 to 60 months		68 023			41 282			95 540
		from 61 to 84 months		69 283			46 125			247 972
		above 84 months		70 162			57 862			231 973
POCI		up to 12 months		34 508			3 232			107 529
		from 13 to 24 months		22 239			2 947			270 242
		from 25 to 36 months		12 010			3 027			58 575
		from 37 to 48 months		10 158			9 384			17 711
		from 49 to 60 months		4 838			6 376			52 828
		from 61 to 84 months		3 239			2 732			110 825
		above 84 months		36 712			24 410			54 081

31.12.2024

Loans and advances to individuals

Loans and advances to individuals- mortgage loans

Loans and advances to enterprises and lease receivables

	PD range at recognition date	Balance sheet exposures gross	Off-balance sheet exposures	Balance sheet exposures gross	Off-balance sheet exposures	Balance sheet exposures gross	Off-balance sheet exposures
Stage 1	from 0,00% to <0,15%	1 961 649	1 610 453	37 307 470	950 346	4 932 665	16 373 562
	from 0,15% to <0,25%	753 113	239 679	945 813	275	5 274 593	5 461 705
	from 0,25% to <0,50%	1 708 288	1 500 293	6 031 833	125 450	21 088 545	10 079 884
	from 0,50% to <0,75%	3 232 817	137 640	1 502 744	12 051	11 305 826	9 170 744
	from 0,75% to <2,50%	14 482 562	870 276	1 668 626	13 943	22 333 410	11 409 471
	from 2,50% to <10,0%	6 417 351	168 543	407 340	1 675	6 447 148	1 625 465
	from 10,0% to <45,0%	534 552	22 505	390	-	688 592	7 419
	from 45,0% to <100,0%	21 267	775	-	-	15 893	5
	Total Stage 1	29 111 598	4 550 165	47 864 215	1 103 739	72 086 672	54 128 253
Stage 2	from 0,00% to <0,15%	203 767	34 137	4 406 928	-	44 034	413
	from 0,15% to <0,25%	79 802	52 300	118 328	-	308 213	25 709
	from 0,25% to <0,50%	123 675	3 290	1 025 842	-	788 704	29 663
	from 0,50% to <0,75%	439 943	231 265	303 405	65	881 107	117 879
	from 0,75% to <2,50%	1 918 405	43 620	369 376	12 263	2 212 084	400 544
	from 2,50% to <10,0%	842 649	38 497	139 781	107 974	1 539 169	608 241
	from 10,0% to <45,0%	195 069	152	5 162	60	1 190 857	23 586
	from 45,0% to <100,0%	184 756	-	311	-	35 702	-
	Total Stage 2	3 988 067	403 260	6 369 133	120 362	6 999 870	1 206 035

	Default period	EAD after credit risk mitigation and credit conversion factor applied
	Default period	Loans and advances to individuals	Loans and advances to individuals- mortgage loans	Loans and advances to enterprises and lease receivables
Stage 3	up to 12 months	1 384 235	257 024	2 014 155
	from 13 to 24 months	659 224	213 725	809 536
	from 25 to 36 months	260 624	142 901	362 361
	from 37 to 48 months	123 784	61 197	181 042
	from 49 to 60 months	79 438	29 065	157 914
	from 61 to 84 months	118 384	63 345	196 976
	above 84 months	79 059	61 449	316 165
POCI	up to 12 months	43 591	7 028	67 204
	from 13 to 24 months	28 909	5 604	76 020
	from 25 to 36 months	20 560	13 223	75 148
	from 37 to 48 months	9 022	10 449	58 894
	from 49 to 60 months	3 506	2 721	18 887
	from 61 to 84 months	6 063	6 806	149 182
	above 84 months	24 273	45 934	32 912

The tables below present the quality of ‘Loans and advances to business customers measured at fait value through other comprehensive income’ broken down into stages as at 31.12.2025 and in the comparative period:

		Loans and advances to customers measured at fair value through OCI
31.12.2025	PD range	Stage 1	Stage 2	Stage 3	Total

	from 0,00 do <0,15%	-	-	-	-
	from 0,15 do <0,25%	368 342	-	-	368 342
	from 0,25 do <0,50%	996 030	-	-	996 030
	from 0,50 do <0,75%	377 564	119 266	-	496 830
	from 0,75 do <2,50%	822 267	488 903	-	1 311 170
	from 45,0 do <100%	-	-	146 677	146 677
Gross amount		2 564 203	608 169	146 677	3 319 049

Impairment		(10 028)	(36 022)	(105 615)	(151 665)
Net amount		2 554 175	572 147	41 062	3 167 384

		Loans and advances to customers measured at fair value through OCI
31.12.2024	PD range	Stage 1	Stage 2	Stage 3	Total

	from 0,00 do <0,15%	446 198	-	-	446 198
	from 0,15 do <0,25%	391 709	-	-	391 709
	from 0,25 do <0,50%	1 359 639	-	-	1 359 639
	from 0,50 do <0,75%	812 642	126 106	-	938 748
	from 0,75 do <2,50%	1 089 030	-	-	1 089 030
	from 45,0 do <100%	-	-	164 690	164 690
Gross amount		4 099 218	126 106	164 690	4 390 014

Impairment		(10 919)	(19 109)	(69 990)	(100 018)
Net amount		4 088 299	106 997	94 700	4 289 996

The tables below present the quality of financial assets of Santander Bank Polska Group broken down into stages and by ratings as at 31.12.2025 and in the comparative period:

Stage 1
31.12.2025	Loans and advances to banks**	Debt securities under “Cash and cash equivalents”	Debt securities measured at fair value through other comprehensive income	Debt investment securities measured at amortised cost	Assets pledged as collateral	Debt securities held for trading
Credit quality step *
1(AAA to AA-)	831 810		545 216	6 227 103	-	-
2(A+ to A-)	3 496 454	5 995 633	28 144 206	43 461 932	2 575 358	3 993 475
3(BBB+ to BBB-)	17 547		-	-	-	-
4(BB+ to BB-)	110		-	-	-	-
5(B+ to B-)			-	-	-	-
6(<B-)			-	-	-	-
no external rating	251 720		-	-	-	1 231
Total Stage 1	4 597 641	5 995 633	28 689 422	49 689 035	2 575 358	3 994 706

* according to Fitch;

** including those shown in the line "Cash and cash equivalents"

There are no instruments classified to Stage 2 as at 31.12.2025.

Stage 3
31.12.2025		Loans and advances to banks**		Debt securities under “Cash and cash equivalents”		Debt securities measured at fair value through other comprehensive income		Debt investment securities measured at amortised cost		Assets pledged as collateral		Debt securities held for trading
Credit quality step *
1(AAA to AA-)		-		-		-		-		-		-
2(A+ to A-)		-		-		-		-		-		-
3(BBB+ to BBB-)		-		-		-		-		-		-
4(BB+ to BB-)		-		-		-		-		-		-
5(B+ to B-)		-		-		-		-		-		-
6(<B-)		-		-		-		-		-		-
no external rating		-		-		394		-		-		-
Total Stage 3		-		-		394		-		-		-
Stage 1
31.12.2024 restated	Loans and advances to banks**		Debt securities under “Cash and cash equivalents”		Debt securities measured at fair value through other comprehensive income		Debt investment securities measured at amortised cost		Debt investment securities measured at fair value through profit and loss		Assets pledged as collateral		Debt securities held for trading
Credit quality level *
1(AAA to AA-)	270 337				1 160 381		3 030 737		1 247				-
2(A+ to A-)	8 496 194		5 995 623		33 687 076		32 566 260				1 198 845		1 505 030
3(BBB+ to BBB-)	26 031				-		-		-				-
4(BB+ to BB-)	1 376				-		-		-				-
5(B+ to B-)	-				-		-		-				-
6(<B-)	-				-		-		-				-
no external rating	19 050				-		-		-				1 572
Total Stage 1	8 812 988		5 995 623		34 847 457		35 596 997		1 247		1 198 845		1 506 602
* according to Fitch ** including those shown in the line "Cash and cash equivalents"

There are no instruments classified to Stage 2 as at 31.12.2024.

Stage 3
31.12.2024	Loans and advances to banks	Debt securities under “Cash and cash equivalents”	Debt securities measured at fair value through other comprehensive income	Debt investment securities measured at amortised cost	Debt investment securities measured at fair value through profit and loss	Assets pledged as collateral	Debt securities held for trading
Credit quality level *
1(AAA to AA-)	-	-	-	-	-	-	-
2(A+ to A-)	-	-	-	-	-	-	-
3(BBB+ to BBB-)	-	-	-	-	-	-	-
4(BB+ to BB-)	-	-	-	-	-	-	-
5(B+ to B-)	-	-	-	-	-	-	-
6(<B-)	-	-	-	-	-	-	-
no external rating	-	-	394	-	-	-	-
Total Stage 3	-	-	394	-	-	-	-

* according to Fitch

Loans and advances to banks are assessed using ratings. The assessment method was set out in the Group’s internal regulations. Each institutional client (exposure) is assigned a rating by one of the reputable rating agencies (Fitch, Moody’s, S&P), in accordance with the CRR. Then, a relevant grade is allocated to the client. There are no overdue or impaired loans and advances to banks.

Financial instruments are assessed in accordance with the sovereign rating (treasury bonds, securities issued by the National Bank of Poland [NBP], Bank Gospodarstwa Krajowego [BGK]). The sovereign rating is the same as the NBP/BGK rating. All have the same rating as Poland, according to Fitch it is A-. Reverse sale and repurchase agreements to banks (including those in the item “Cash and cash equivalents”) are in low-risk classes in Stage 1.

For all instruments presented above (including also loans and advances to customers measured at fair value through other comprehensive income), there is no overdue or impairment, therefore they are classified to Stage 1. In accordance with its definition- as exposures with no significant increase in risk since initial recognition, i.e. the likelihood of the exposure being downgraded to the impaired portfolio (Stage 3)has not increased. For such exposures, 12-month expected credit losses will be recognized.

Credit risk concentration

Santander Bank Polska Group adheres to the standards provided for in the Banking Law with regard to the concentration of risk bearing exposures to a single entity or a group of entities connected in terms of capital or organisation. As at 31.12.2025, pursuant to art. 71 of the Banking Law Act, the maximum limits for the Group amounted to:

· PLN 6 633 451 k (25% of Group’s own funds).

As at 31.12.2024, pursuant to art. 71 of the Banking Law Act, the maximum limits for the Group amounted to:

· PLN 6 644 512 k (25% of Group’s own funds).

The policy pursued by the Group aims at minimising the credit concentration risk, by for example applying more rigorous than regulatory rules in this respect. The effect of this policy is maintenance of high level of diversification of exposures towards individual customers.

The analysis of the Group’s exposures in terms of sector concentrations, proved that the Group does not have any exposures in excess of the limits imposed by the regulator in 2025.

A list of the 20 largest borrowers (or capital-related group of borrowers) of Santander Bank Polska Group (performing loans) as at 31.12.2025.

Industry code(PKD)	Industry description	Total credit exposure	Balance sheet exposure incl. towards subsidiaries	Committed credit lines, guarantees, treasury limits and capital investments
19	RAFINERY	5 398 553	46 760	5 351 793
64	OTHER FINANCIAL SERVICES	5 121 798	816 160	4 305 638
84	PUBLIC ADMINISTRATION	3 487 911	1 920 252	1 567 659
35	POWER INDUSTRY	2 760 676	750 900	2 009 776
64	OTHER FINANCIAL SERVICES	2 405 436	578 422	1 827 014
07	MINING	2 039 801	217 571	1 822 230
64	OTHER FINANCIAL SERVICES	2 032 693	-	2 032 693
47	RETAIL SALES	1 896 199	669 449	1 226 750
47	RETAIL SALES	1 794 457	1 168 025	626 432
61	TELECOMMUNICATION	1 749 335	1 031 116	718 218
65	REINSURANCE	1 644 206	425 819	1 218 388
77	RENTAL OF CARS	1 591 523	1 465 731	125 792
47	RETAIL SALES	1 341 462	1 139 158	202 305
35	POWER INDUSTRY	1 323 788	71 598	1 252 189
61	TELECOMMUNICATION	1 120 233	523 962	596 271
64	OTHER FINANCIAL SERVICES	1 044 179	65 909	978 270
64	OTHER FINANCIAL SERVICES	955 239	579 233	376 007
45	WHOLESALE AND RETAIL	933 263	456 373	476 890
27	MANUFACTURING	916 383	332 735	583 648
41	CONSTRUCTION	909 466	156 894	752 572
Total gross exposure		40 466 601	12 416 067	28 050 534

*For clarity, the table does not present connections between the Bank’s customers and the State Treasury; i.e. exposure to the State Treasury is disclosed separately from exposures to entities connected with the State Treasury;

A list of the 20 largest borrowers (or capital-related group of borrowers) of Santander Bank Polska Group (performing loans) as at 31.12.2024.

Industry code(PKD)	Industry description	Total credit exposure	Balance sheet exposure incl. towards subsidiaries	Committed credit lines, guarantees, treasury limits and capital investments
64	OTHER FINANCIAL SERVICES	7 179 046	500 000	6 679 046
84	PUBLIC ADMINISTRATION	3 062 051	-	3 062 051
35	POWER INDUSTRY	2 985 584	-	2 985 584
64	OTHER FINANCIAL SERVICES	2 144 930	-	2 144 930
19	RAFINERY	2 087 742	450 091	1 637 652
47	RETAIL SALES	1 747 852	-	1 747 852
61	TELECOMMUNICATION	1 570 772	1 153 108	417 664
35	POWER INDUSTRY	1 480 252	28 125	1 452 127
64	OTHER FINANCIAL SERVICES	1 400 000	1 400 000	-
47	RETAIL SALES	1 393 940	579 531	814 409
65	REINSURANCE	1 311 669	-	1 311 669
64	OTHER FINANCIAL SERVICES	1 307 485	-	1 307 485
64	OTHER FINANCIAL SERVICES	1 269 604	-	1 269 604
64	OTHER FINANCIAL SERVICES	1 253 526	-	1 253 526
64	OTHER FINANCIAL SERVICES	1 201 319	1 148 000	53 319
61	TELECOMMUNICATION	1 127 397	431 275	696 122
70	OPERATIONS OF HEAD OFFICES	1 052 330	-	1 052 330
64	OTHER FINANCIAL SERVICES	1 011 265	529 098	482 167
20	CHEMICAL INDUSTRY	954 534	938 023	16 511
64	OTHER FINANCIAL SERVICES	905 080	22 204	882 876
		36 446 378	7 179 455	29 266 923

*For clarity, the table does not present connections between the Bank’s customers and the State Treasury; i.e. exposure to the State Treasury is disclosed separately from exposures to entities connected with the State Treasury;

Industry concentration

The credit policy of Santander Bank Polska Group assumes diversification of credit exposures. Risk of particular industry affects value of the exposure limit. In order to ensure adequate portfolio diversification and control the risk of overexposure to a single industry, the Group provides funding to sectors and groups or capital units representing a variety of industries.

As at 31.12.2025, the highest concentration level was recorded in the “manufacturing” sector (10% of the Santander Bank Polska Group exposure), “trade” (9%) and “real estate services” (7%).

Breakdown of non-trading business loans and advances by NACE codes:

	NACE sector	Gross exposure
	NACE sector	31.12.2025	31.12.2024
	Agriculture, forestry and fishing	4 465 743	4 127 031
	Mining and quarrying	1 636 276	1 519 721
	Manufacturing	15 929 590	16 543 709
	Electricity, gas, steam and air conditioningsupply	2 957 344	3 318 010
	Water supply	693 998	538 740
	Construction	3 655 670	4 074 926
	Wholesale and retail trade	14 982 248	16 247 843
	Transport and storage	4 566 716	6 290 895
	Accomodation and food service activities	2 385 311	2 149 170
	Information and communication	3 479 822	3 533 052
	Financial and insurance activities	5 167 827	1 797 899
	Real estate activities	11 819 382	9 751 160
	Professional, scientific and technical activities	5 854 940	7 457 722
	Administrative and support service activities	3 986 906	3 703 141
	Public administration and defence, .compulsory social security	4 346	33 352
	Education	334 185	402 401
	Human health services and social work activities	1 708 892	1 921 629
	Arts, entertainment and recreation	659 023	507 090
	Other services	739 495	5 104 277
A	Total Business Loans	85 027 714	89 021 769
B	Retail (including mortgage loans)	79 743 677	88 814 191
C	Loans to public sector	2 142 139	2 439 265
A+B+C	Santander Bank Polska SA portfolio	166 913 530	180 275 225
D	Other receivables	61 127	70 339
A+B+C+D	Total Santander Bank Polska SA	166 974 657	180 345 564

Climate related risk

At Santander Bank Polska Group environmental matters are embedded in decision-making processes. The ESG (environmental, social, governance) guidelines are used for evaluating the assets to be financed by the Bank.

More broadly, issues related to climate goals, climate policy and initiatives and actions undertaken by the Bank and the Group are described in the "Consolidated Sustainability Statement of Santander Bank Polska Group for 2025" which is part of the Management Board Report on the activities of Santander Bank Polska Group in 2025. This document also contains quantitative disclosures.

The Bank and the Group entities considered the climate-related risks when preparing the financial statements in accordance with International Financial Reporting Standards, and where necessary, the Standards were applied in a manner that takes this into account.

The subject of the considerations was, in particular, the impact of environmental issues on the Bank and the Group's entities in the context of the application of:

- IAS 1: Presentation of Financial Statements

- IAS 12: Income Taxes

- IAS 36: Impairment of Assets

- IFRS 9: Financial Instruments

- IFRS 13: Fair Value

- IAS 37: Provisions, Contingent Liabilities and Contingent Assets

At the same time, based on the conducted analysis, no significant impact of environmental issues on the financial statements as a whole was found.

The Bank and the Group entities conducted an analysis of the main transformational and physical risks, and thanks to the identification of key risks for our latitude, the risk in the sectors most affected by climate change was evaluated. This allowed for the improvement of the risk assessment process for individual business clients in these aspects.

In 2025, a comprehensive analysis of balance sheet exposures under a stress scenario, taking into account both transition and physical risk, was conducted. The results were incorporated into the process of assessing the adequacy of allocated internal capital. The results indicate no significant correlation between portfolio parameters over the time horizon analyzed in the stress tests. In the climate scenario, capital surpluses achieved relative to the required minimum levels are lower than in the baseline scenarios, but the financial and capital position of the Bank and the Group remains strong and stable.

At the same time, the Group performed the further iterations of analyzes aimed at identification and of transformational and physical risks in a systemic and quantitative manner. By estimating the emissivity of all business entities and retail mortgage products, the Group assess transformational risks and deliberate actions in key parts of the portfolio. It will also allow for the inclusion of environmental aspects in standard portfolio analysis processes, setting targets and limits at appropriate levels.

ESG risk management as part of the risk management framework

Effective identification of risks and opportunities related to climate change allows Santander Bank Polska S.A. to take measures to ensure reliance to key threats, accelerate growth, improve financial results, and build reputation.

Risks related to social and environmental issues, including climate, are taken into account in the risk management system developed and implemented by the Management Board. This system operates on the basis of three lines of defense, covers all significant types of risk and the interdependencies of individual risks.

In accordance with the recommendations, the Bank performs analyzes of physical and transformational risk, including them in the taxonomy of risks typical for the Bank. The Group does not separate ESG risk as a separate material risk, but indicates its transmission channels into: credit, market and liquidity, compliance, reputation, business and operational risks.

A methodology for assessing the level of climate risks – physical and transition for individual climate sectors and real estate (introducing a taxonomy of climate sectors to the Bank) has been introduced, which allowed for a portfolio analysis of the significance of climate risks for the credit portfolio. The reports in question are already presented to selected committees, and this information is used in the assessment of credit risk of clients and transactions.

The Social, Environmental and Climate Change Risk Management Policy is in force at Bank, approved by the Bank's Management Board. It specifies the criteria for the Bank's ability to cooperate with clients operating in selected sensitive sectors. The document defines areas of activity divided into two categories: prohibited activities and activities subject to additional analysis. In connection with the adjustment of credit processes to the provisions of the Policy, some exposures characterized by too high and unmanaged transformation risk are not accepted.

Concentration limits have been defined:

• for sectors that contribute the most to climate change, which are also most exposed to transformation risks.

• for business and mortgage-secured exposures in locations assessed as highly exposed to physical risks

and measures of the acceptable level of risk regarding the Bank's declarations included in the Environmental and Social Risk Management Policy.

Depending on the level of climate risk assessment for individual sectors, elements influencing the estimation of the level of credit risk are added to the credit process. For selected clients from business segments, an individual ESCC (Environmental Social & Climate Change) risk analysis is performed for clients / transactions operating in sectors defined in the Bank's policies. The conducted ESCC risk analysis and recommendation is included in the client's credit application, and if it affects the assessment of credit risk parameters, it is included in the client's rating assessment. In 2025, a dedicated internal system tool was implemented in this area.

In 2025, credit policy requirements for mortgage collateral established for exposures to individual clients were strengthened to reduce the materialization of flash flood risk. These changes concern both the scope of mandatory insurance and the exclusion of the most vulnerable areas from financing.

In 2025, the Bank updated its portfolio sensitivity analysis to climate risks, taking into account the sensitivity of its most exposed sectors. This year, this analysis was expanded to include biodiversity, and the scope of sectors analyzed was aligned with EBA regulatory requirements. The analysis was carried out in three time horizons - short (2030), medium (2040) and long (2050). It was decided to use climate scenarios defined by a group of central banks and supervisory institutions, which brings together over 130 institutions (including the largest ones, such as the European Central Bank, the Bank of England and the United States Federal Reserve System) determined to act for better understanding and management of climate risks (Network for Greening the Financial System, NGFS). For physical risk, the analysis was based on external data defining the level of physical risks for over 15 climate phenomena (sudden and chronic) at the municipal level, using RCP (representative concentration pathways) scenarios. These are four scenarios of changes in carbon dioxide concentration that were accepted by the Intergovernmental Panel on Climate Change in the project of comparing global climate models.

In 2025, the Bank introduced two high-level regulations formalizing its management system:

• ESG risk, along with transmission channels for all material risks mentioned above,

• Greenwashing risk across all affected processes: strategy, policies, financial products and operations, communications and marketing, reporting and disclosure, and suppliers.

The Bank has undertaken a number of activities to supplement its ESG risk management system to align with the requirements of the EBA Guidelines (EBA/GL/2025/01) on managing environmental, social, and governance risks. In particular, it has developed and reinforced a Transition Plan by the Bank's Management, which will be further developed in subsequent phases.

Responsibility for ESG risk management

The responsibility for managing climate risk and leveraging climate-related opportunities rests with the Management Board and the Supervisory Board. They support risk management strategies by approving key policies, sitting on dedicated committees, participating in reviews and approving risks and reports. The member of the Management Board supervising ESG risk management is the member managing the Risk Management Division.

Since 2023, the ESG Risk Management Office was established within the Risk Management Division, whose responsibility is to ensure the appropriate organization of the ESG Risk management function.

The Bank’s Management Board is responsible for defining long-term action plans and approving the responsible banking strategy, including the climate strategy and its main objectives (in a short, medium and/or long term), and as part of the risk management framework. ESG direction has become one of the 3 pillars of Group's strategy for 2024-2026, it is the TOTAL Responsibility pillar, creating the strategy together with the TOTAL Experience and TOTAL Digitalization pillars.

The Supervisory Board verifies the Bank’s management strategy and ESG risk management strategy, also in terms of the Bank’s long-term interest.

There is also the ESG Committee, which provides support to the Bank’s Management Board in the performance of oversight over the responsible banking and sustainability strategy both locally and at the level of Santander Bank Polska Group. The Committee, which is chaired by the President of the Management Board, defines the strategy and annual goals related to ESG and ensures compliance with environmental and social policies of Santander Bank Polska S.A. The Committee is supported by the ESG Forum composed of senior managers representing all Divisions. The Forum analyses challenges, opportunities and risks related to the EU Sustainable Finance agenda (including ESG risks), plans activities and coordinates their implementation at the Bank, and submits regular reports to the Responsible Banking and Corporate Culture Committee and the Bank’s Management Board.

The Bank has a formalized process for accepting sustainable financing. In 2023, the ESG Panel was established within the Risk Management Division, whose responsibility is to certify sustainable financing in relation to internal and external regulations, thereby contributing to reducing the risk of greenwashing.

Market risk

Introduction

Market risk is defined as an adverse earnings impact of changes in interest rates, FX rates, share quotations, stock exchange indices, etc. It arises both in trading and banking activity (FX products, interest rate products, equity linked trackers).

Santander Bank Polska Group is exposed to market risk arising from its activity in money and capital markets and services provided to customers. Additionally, the Group undertakes the market risk related to the active management of balance sheet structure (assets and liabilities management).

The activity and strategies on market risk management are directly supervised by the Market and Investment Risk Committee and are pursued in accordance with the framework set out in the Market Risk Policy and the Structural Risk Policy approved by the Management Board and the Supervisory Board.

Risk management structure and organisation

The key objective of the market risk policy pursued by the Group is to reduce the impact of variable market factors on the Group’s profitability and to grow income within the strictly defined risk limits while ensuring the Group’s liquidity and market value.

The market risk policies of Santander Bank Polska Group establish a number of risk measurement and mitigation parameters in the form of limits and metrics. Risk limits are periodically reviewed to align them with the Group’s strategy.

Interest rate and FX risks linked to the banking business are managed centrally by the Financial Management Division. The Division is also responsible for acquiring funding, managing liquidity and making transactions on behalf of ALCO. This activity is controlled by the measures and limits approved by the Market and Investment Risk Committee, the bank’s Management Board and the Supervisory Board.

The debt securities and the interest rate and FX hedging portfolio is managed by ALCO Committee, which takes all decisions on the portfolio’s value and structure.

The market risk on the trading portfolio is managed by the Corporate and Investment Banking Department. The Group’s trading activity is subject to a system of measures and limits, including Value at Risk, stop loss, position limits and sensitivity limits. These limits are approved by the Market and Investment Risk Committee, the bank’s Management Board and the Supervisory Board.

Within the Risk Management Division in the Integrated Risk Management Centre, there are the Banking Book Risk Office and the Trading Book Risk Office are responsible for ongoing risk measurement, implementation of control procedures and risk monitoring and reporting. Both Offices are also responsible for shaping the market risk policy, proposing risk measurement methodologies and ensuring consistency of the risk management process across the Group. Owing to the fact that both Offices are a part of the Risk Management Division, the risk measurement and monitoring processes are separate from the risk-taking units.

The market risk of equity instruments held by Santander Brokerage Poland (shares, index-linked securities) is managed by Santander Brokerage Poland itself and supervised by the Market and Investment Risk Committee of Santander Bank Polska S.A.

The bank’s Market and Investment Risk Committee, chaired by the Management Board member in charge of the Risk Management Division, is responsible for independent control and monitoring of market risk in the banking and trading books.

Risk identification and measurement

The trading book of Santander Bank Polska Group contains securities and derivatives held by the Corporate and Investment Banking Division for trading purposes. The instruments are marked to market each day, and any changes in their value are reflected in the profit and loss. Market risk in the trading book includes interest rate risk, currency risk and repricing risk.

The interest rate risk in the Group’s banking book is the risk of adverse impact of interest rate changes on the Group’s income and the value of its assets and liabilities. Interest rate risk arises primarily on transactions entered in the bank’s branches and in the business and corporate centres, as well as the transactions made in the wholesale market by the Financial Management Division. Additionally, interest rate risk can be generated by transactions concluded by other units, e.g. through acquisition of municipal/ commercial bonds or the bank’s borrowings from other sources than the interbank market.

Santander Bank Polska Group uses several methods to measure its market risk exposure. The methods employed for the banking portfolio are the MVE and NII sensitivity measures, stress tests and Value at Risk (VaR), while the methods used for the trading portfolio include: VaR and stressed VaR, stop loss, sensitivity measures (PV01) and stress tests. The risk measurement methodology is subject to an independent initial and periodic validation, the results of which are presented for approval to the Model Risk Management Committee.

At Santander Bank Polska Group, the VaR in the trading portfolio is determined using a historical method as a difference between the mark-to-market value of positions and the market values based on the most severe movements in market rates from a determined observation window. VaR is calculated separately for interest rate risk, FX risk and the two risks at the same time. VaR is also calculated for the repricing risk of the equity instruments portfolio of Santander Brokerage Poland.

Due to the limitations of the VaR methodology, the Group additionally performs sensitivity measurement (showing how position values change in reaction to price/profitability movements), Stressed VaR measurement and stress tests.

Risk reporting

The responsibility for reporting market risk rests with the Risk Management Division, specifically the Banking Book Risk Office.

Each day, the Trading Book Risk Office controls the market risk exposure of the trading book in accordance with the methodology laid down in the Market Risk Policy. It verifies the use of risk limits and reports risk levels to units responsible for risk management in the trading book, to Santander Group and to the Market and Investment Risk Committee.

Once a month, the Trading Book Risk Office provides information about the risk exposure of the trading book and selected measures to the Market and Investment Risk Committee and prepares the Risk Dashboard (in cooperation with other units of the Risk Management Division), which is presented to the Risk Management Committee.

The results of market risk measurement with regard to the banking book are reported by the Banking Book Risk Office to persons responsible for operational management of the bank’s balance sheet structure and to persons in charge of structural risk management on a daily basis (information about the ALCO portfolio) or on a monthly basis (interest rate gap, NII and MVE sensitivity measures, stress test results, VaR). This information is also reported each month to the bank’s senior executives (Market and Investment Risk Committee, ALCO). The selected key interest rate risk measures, including risk appetite measures defined for the Group’s banking book, are reported to the bank’s Management Board and Supervisory Board.

Risk prevention and mitigation

The Bank has adopted a conservative approach to risk-taking both in terms of the size of exposures and the types of products. A large portion of the Financial Market Area activity revolves around mitigating the risk related to customer transactions at the retail and corporate level. In addition, flows from customer transactions are generally for amounts and tenors not quoted on the market directly and thus risk capacity is required to manage these mismatches with wholesale transactions.

From the Bank’s perspective, the market risk limits are at safe level and are in place to allow sufficient capacity and time to neutralise interest rate risk and foreign exchange risks, while at the same time allowing the Financial Market Area to hold some of portfolio positions opened to add value to the organisation.

There is a greater emphasis placed on market making over pure mark to market trading and this is reflected in both limit utilisation and budgetary targets of Financial Market Area.

The combination of transactions made by the Financial Market Area and positions transferred from the bank arising from customers’ FX and derivative activity create the overall interest rate and currency risk profiles, which are managed under the policy and operational limits in place. The Financial Market Area subsequently decides either to close these positions or keep them open in line with market view and approved limits. The return earned is a mix of flow management and market making. However, there is no intention to keep aggressive trading positions.

The interest rate and currency risk of the Financial Market Area is managed via the trading book in accordance with the Market Risk Policy approved by the Management Board. Accounting and risk systems help to ensure allocation of each position into appropriate books. The relevant desks are responsible for suitable risk activity (interest rate or currency risk).

To ensure that the trading book positions are marketable, the bank controls the gross value of the positions (separately long and short positions) versus the entire market. This is to check if it is technically possible to close an open position one way, without taking into account other closings. The control is performed by the Trading Book Risk Office separately for currency positions and interest rate positions. The control results are reported to the Financial Market Area.

As regards market risk in the banking book, all positions that generate repricing risk are transferred for management to the Financial Management Division, responsible for shaping the bank’s balance sheet structure, including by entering into transactions in the interbank market so as to manage the interest rate risk profile according to the approved risk strategy and in compliance with the allocated risk limits.

The bank’s subsidiaries also mitigate their exposure to interest rate and FX risk. If there is a mismatch between the repricing of assets and liabilities, the company enters into appropriate transactions via the standard bank accounts held with the bank or makes derivative transactions with the bank, which from the transaction date manages the risk as part of the global limit of Santander Bank Polska Group and can also make standard currency exchange transactions with the Bank.

The interest rate risk in the banking book is managed based on the following limits:

· NII sensitivity limit (the sensitivity of net interest income to a parallel shift of the yield curve by 100 bp);

· MVE sensitivity limit (the sensitivity of the market value of equity to a parallel shift of the yield curve by 100 bp).

The table below presents the sensitivity of net interest income (NII) and economic value of equity (MVE) to a parallel shift in yield curves at the end of 2025 and the comparative period. It presents the results of scenarios in which the impact of interest rate changes on net interest income and economic value of equity would be negative. Data are presented in millions of PLN and cover the Bank on a stand-alone basis and the Santander Bank Polska Group. Data at the end of 2024 included Santander Consumer Bank S.A., while at the end of 2025 this company is excluded from the reporting scope:

	NII Sensitivity		MVE Sensitivity
1 day holding period	31.12.2025	31.12.2024	31.12.2025	31.12.2024

Santander Bank Polska	(258)	(313)	(1 070)	(963)
Santander Bank Polska Group	(274)	(376)	(1 075)	(1 143)

Compared to 2024, the utilisation of the MVE sensitivity limit increased, while the utilisation of the NII sensitivity limit decreased. There were no exceedances of RED operational limits. The increase in MVE exposure was caused by the implementation of the interest income sensitivity hedging strategy, which consequently increased the duration of the banking book portfolio. The implementation of the aforementioned hedging strategy was mainly based on concluding cash flow hedging transactions under hedge accounting and increasing the ALCO portfolio with fixed-coupon debt securities.

VaR in the banking portfolio is calculated separately as a combined effect of EaR (Earnings-at-Risk) and EVE VaR (value at risk of the economic value of equity).

The key methods of measurement of the interest rate risk in the trading book include the VaR methodology, stop loss, PV01 sensitivity measurement and stress tests.

The VaR is set for open positions of the Financial Market Area using the historical simulations method. Under this method the bank estimates the portfolio value of 520 scenarios generated on the basis of historically observable changes in market parameters. VaR is then estimated as the difference between the current valuation and the valuation of the 99^th percentile of the lowest valuations.

The stop-loss mechanism is used to manage the risk of loss on positions subject to fair value measurement through profit or loss.

Stress tests are used in addition to these measures by providing an estimate of the potential losses in the event of materialisation of the stressed conditions in the market. The assumptions of stress scenarios are based on sensitivity reports and on extreme market rate movement scenarios set using the highest daily and monthly changes in interest rates.

The table below shows risk measures at the end of 2025 and 2024 for 1-day position holding period (in PLN k):

Interest rate risk		VAR
1 day holding period		31.12.2025	31.12.2024
Average	4 300		8 203
Maximum	12 576		12 892
Minimum	1 781		3 913
as at the end of the period	4 240		3 913
Limit	15 343		16 036

The observed values of the VaR in 2025 were lower than in 2024 reflecting lower volatility and stabilization in the interest rate market., Th maximum observed interest rate VaR lower compared to previous year. Approved for 2025 VaR-like limit levels were, in average, larger by several percent than those in effect in 2024 for values expressed in USD, but the decline in the dollar-zloty exchange rate during the year resulted in a decrease in the PLN limits. Based on that, average VaR position held across the year remains in line with expected risk exposure for 2025.

FX risk is the risk that adverse movements in foreign exchange rates will have an impact on performance (and result in losses). This risk is managed on the basis of the VaR limit for the open currency positions in the Group’s trading portfolio and the portfolio of Santander Brokerage Poland which manages open positions linked to the market maker activity. Stress tests are used in addition to this measure by providing an estimate of the potential losses in the event of materialisation of the stressed conditions in the market. Stress tests use the currency exposure and the scenarios of extreme movements in currency rates based on historical data. Furthermore, the stop-loss mechanism is used for managing the risk of losses on trading positions.

In 2025, the Group's policy changed, allowing for the maintenance of open positions in currency and interest rate options on trading book portfolios. This change resulted in the introduction of a new VAR Vega metric, which is calculated daily and includes the VAR value for open options positions. The VAR Vega limit for 2025 was set at PLN 180,000.

Open FX positions of subsidiaries are negligible and are not included in the daily risk estimation.

The table below illustrates the risk measures at the end of December 2025 and 2024 (in PLN k).

FX risk	VAR
1 day holding period	31.12.2025	31.12.2024
Average	465	679
Maximum	1 838	1 742
Minimum	67	234
as at the end of the period	501	356
Limit	3 241	3 691

Both the levels of limits applied in the VaR area for currency risk and the exposure values remain stable year-on-year. In 2025, there were no exceedances of VaR limits, which confirms the adequacy of the established VaR limits, corresponding to the Bank's business activities and the related exposure to market risk.

The tables below present the Group’s key FX positions as at 31 December 2025 and in the comparable period.

31.12.2025	PLN	EUR	CHF	USD	Other	Total
ASSETS
Cash and cash equivalents	21 436 892	4 285 141	49 451	2 996 591	1 736 664	30 504 739
Loans and advances to banks	323 480	2 048 158	-	10	-	2 371 648
Loans and advances to customers	135 015 699	26 045 829	7 007	1 686 849	82 340	162 837 724
Investment securities	71 686 090	7 230 214	-	454 607	-	79 370 911
Selected assets	228 462 161	39 609 342	56 458	5 138 057	1 819 004	275 085 022
LIABILITIES
Deposits from banks	1 288 465	1 344 062	32608	181 072	1 073	2 847 280
Deposits from customers	185 514 101	32 722 604	1 078 688	8 992 387	1 834 784	230 142 564
Subordinated liabilities	1 014 851	587 114	-	-	-	1 601 965
Selected liabilities	187 817 417	34 653 780	1 111 296	9 173 459	1 835 857	234 591 809

31.12.2024 restated*	PLN	EUR	CHF	USD	Other	Total
ASSETS
Cash and cash equivalents	16 960 183	5 565 737	48 542	4 827 492	1 601 552	29 003 506
Loans and advances to banks	155 307	3 875 858	-	-	-	4 031 165
Loans and advances to customers	147 298 313	25 094 119	394 980	1 833 642	155 227	174 776 281
Investment securities	65 943 117	4 456 849	-	517 065	-	70 917 031
Selected assets	230 356 920	38 992 563	443 522	7 178 199	1 756 779	278 727 983
LIABILITIES
Deposits from banks	2 453 600	2 473 078	557	219 742	1 683	5 148 660
Deposits from customers	189 591 445	30 566 962	965 744	9 168 360	1 736 251	232 028 762
Subordinated liabilities	1 118 875	1 110 023	-	-	-	2 228 898
Selected liabilities	193 163 920	34 150 063	966 301	9 388 102	1 737 934	239 406 320

*Data restated following changes to the presentation of cash and cash equivalents; details are presented in Note 2.5.

In regards to the structural exposure to currency risk in the Group’s balance sheet, in 2025 the share of foreign currency assets in the balance sheet decreased. This was due to an smaller increase in the balance of assets in foreign currencies compared to the increase in total assets, with further gradual decrease of CHF loans, as a result of the continuing amortisation of the CHF mortgage portfolio.

The risk attached to the prices of equity instruments listed in active markets is managed by Santander Brokerage Poland, which operates within the Corporate and Investment Banking Division. This risk is generated by own trades of Santander Brokerage Poland concluded in regulated markets (spot market instruments and futures).

It is measured using a Value at Risk model based on the historical analysis method.

The market risk management in Santander Brokerage Poland is supervised by the Market and Investment Risk Committee of Santander Bank Polska S.A. This Committee sets the VaR limit for Santander Brokerage Poland, approves changes in the risk measurement methodology and oversees the risk management process.

The table below presents the risk measures in 2025 and 2024 (in PLN k).

Equity risk	VAR
1 day holding period	31.12.2025	31.12.2024
Average	1 717	761
Maximum	2 301	2 059
Minimum	1 070	439
as at end of the period	2 002	2 059
Limit	2 881	1 638

In 2025, there was no exceedance of the VAR limit for equity risk.

Interest Rate Benchmark reform

Santander Bank Polska S.A. has been running the IBOR Programme from 2022 to mid-2023, aimed at adapting the Bank and its subsidiaries to the decision of the ICE Benchmark Administration to gradually discontinue calculating LIBOR indices. After the establishment of the National Working Group for the reform of benchmarks in Poland (NGR), the Bank adjusted the scope of work and composition of the previously operating Programme in order to introduce products based on the so-called RFR (risk-free rate) indicators to the offer. The work at the Bank is carried out in accordance with the decisions and recommendations of the NGR Steering Committee and the assumptions of the Road Map for the process of replacing the WIBOR and WIBID reference indicators. In December 2024, NGR selected an index to replace the WIBOR and WIBID reference indices, and in January 2025, it selected the name POLSTR for this index proposal. According to the announcements, the final moment of conversion of the historical portfolio is planned for the end of 2027.

The reform work is being carried out by a wide group of experts representing the Bank's key business lines, supported by a renowned consulting firm under the supervision of the Steering Committee, which includes members of the Management Board and top management. In addition, the work is being coordinated with the preparations underway both in subsidiaries and at the level of the entire Group.

The tables present break down of assets and liabilities of Santander Bank Polska Group as at 31 December 2025 and in comparative period:

31.12.2025	Nominal value
Assets and liabilities exposed to PLN WIBOR	Assets	Liabilities
Cash and cash equivalents	-	-
Loans and advances to/deposits from banks	190 000	1 292 376
Loans and advances to/deposits from customers	70 269 143	14 079 947
Reverse repurchase/repurchase agreements	637 400	30 000
Debt securities/ in issue	15 678 891	13 558 777
Lease receivables/liabilities	2 728 951	-
Total value of assets and liabilities exposed to PLN WIBOR	89 504 385	28 961 100
Trading Derivatives (notional)	806 396 728	820 662 877
Hedging Derivatives (notional)	3 069 580	42 931 375

31.12.2024	Nominal value
Assets and liabilities exposed to PLN WIBOR	Assets	Liabilities
Cash and cash equivalents	-	-
Loans and advances to/deposits from banks	190 000	2 045 353
Loans and advances to/deposits from customers	80 007 019	13 784 606
Reverse repurchase/repurchase agreements	2 781 400	734 473
Debt securities/ in issue	15 972 764	10 429 812
Lease receivables/liabilities	5 444 401	-
Total value of assets and liabilities exposed to PLN WIBOR	104 395 584	26 994 244
Trading Derivatives (notional)	681 987 048	668 633 740
Hedging Derivatives (notional)	8 057 930	39 037 500

In connection with the IBOR and WIBOR Reform, the Group is exposed to the following risks:

Business Risk:

Switching to alternative benchmarks may lead to a risk of abuse or misconduct towards clients, resulting in customer complaints, penalties or reputational damage. Possible risks include: risk of misleading customers, risk of market abuse (including insider dealing and market manipulation), risk of anti-competitive practices, both during and after the transition (e.g. collusion and exchange of information) and risks caused by conflicts of interest. The Group has strong transition management structures in place to ensure risk mitigation.

Price risk:

The transition to alternative benchmarks and the discontinuation of the use of interest rate benchmarks may affect the pricing mechanisms applied by the Group for certain transactions, including the establishment of a Standard Variable Rate applicable to mortgage loans. For some financial instruments, it will be necessary to develop new pricing models.

Risk associated with the interest rate base:

This risk consists of two components:

– if bilateral negotiations with the Group's counterparties are not successful before the IBOR ceases to apply, there is significant uncertainty as to the future interest rate. This situation leads to additional interest rate risk, which was not taken into account at the time of entering into contracts and is not the subject of our interest rate risk management strategy. For example, in some cases, provisions on the use of other indicators in contracts where the IBOR rate is applied, may result in the remaining period maintaining a fixed interest rate at the level of the last IBOR rate The Group works closely with all counterparties to avoid such a situation, but if it occurs, the interest rate risk management policy applied in the Group will be applied as standard and may result in liquidation of the interest rate swaps or the conclusion of new swaps to maintain the combination of variable and fixed interest rates for the debt held.

– interest rate risk may also arise where the transition to alternative benchmarks for non-derivatives and derivatives held to manage the interest rate risk associated with the non-derivative occurs at different times. This risk may also occur if you switch to different rates for back-to-back derivatives at different times. The Group will monitor that the risk management referred to above is carried out in accordance with the applicable risk management principles, updated to allow for a temporary mismatch not exceeding 12 months and to establish an additional basis for interest rate swaps, if required.

Hedge Accounting:

If the transition to alternative benchmarks for certain contracts does not allow the application of the exemptions provided for by the Phase 2 amendments, then the effect may be to terminate the hedging relationship and, consequently, increased volatility in the income statement. This may happen if the newly designated hedging relationships are not carried out or if the non-derivative financial instruments are amended or removed from the financial statements.

The Bank did not decide to change the existing hedging relationships with WIBOR. However, due to the expected replacement of the benchmark, the Bank identifies that hedging relationships in which this benchmark is present may be exposed to the risk described above related to the effectiveness of the relationship.

In the case of credit agreements referring to the CHF LIBOR rate, the Bank switched to RFR indicators in accordance with the decision of the European Commission, and in the case of derivative instruments that hedge this portfolio, the CHF LIBOR rate switched to the SARON rate, in accordance with the ISDA Protocol standard.

Based on the conducted efficiency test based on the new rates for CHF - both for the credit portfolio and the hedging instrument - the Bank assessed that there is a high probability of meeting the efficiency requirement of the established hedging relationships in the future.

In connection with the above, in the case of strategies hedging the CHF credit portfolio, the Bank decided to continue the established hedging relationships based on the existing instruments.

Risk of legal proceedings:

In the absence of agreement on the implementation of the Interest Rate Benchmark Reform for existing contracts (e.g. due to different interpretations of the applicable provisions on the use of other benchmarks), there is a risk of litigation and protracted disputes with counterparties, which may result in additional costs, e.g. legal costs. The Group works closely with all contractors to avoid such a situation.

Regulatory risk:

Regulatory models and methodologies are currently being updated (e.g. to take account of new market data). There is a risk that full updates, testing and acceptance of models by regulators will not take place on time.

Operational risk:

We are updating our IT systems to fully manage the transition to alternative benchmarks. There is a risk that such updates will not be fully on time, resulting in additional manual procedures involving operational risk.

Liquidity risk

Introduction

Liquidity risk is the risk that the bank fails to meet its contingent and non-contingent obligations towards customers and counterparties as a result of a mismatch of financial cash flows.

The activity and strategies on liquidity risk management are directly supervised by the Market and Investment Risk Committee and are pursued in accordance with the framework set out in the Liquidity Risk Policy approved by the Management Board and the Supervisory Board.

Risk management structure and organisation

The objective of the Liquidity Risk Policy of Santander Bank Polska Group is to:

· ensure the ability to finance assets and satisfy claims, both current and future, in a timely manner and at an economic price;

· manage the maturity mismatch between assets and liabilities, including the intraday mismatch of cash flows; under normal and stress conditions;

· set a scale of the liquidity risk in the form of various internal limits;

· ensure proper organisation of the liquidity management process within the whole Santander Bank Polska Group;

· prepare the organisation for emergence of adverse factors, either external or internal;

· ensure compliance with regulatory requirements, both qualitative and quantitative.

The general principle adopted by Santander Bank Polska Group in its liquidity management process is that all expected outflows occurring within one month in respect of deposits, current account balances, loan drawdowns, guarantee payments and transaction settlements should be at least fully covered by the anticipated inflows or available High Quality Liquid Assets (HQLA) assuming normal or predictable conditions for the Group’s operations. The HQLA category substantially includes: cash on hand, funds held in the nostro account with the NBP (National Bank of Poland) in excess of the minimum reserve requirement and securities which may be sold or pledged under repo transactions or NBP lombard loans. As at 31 December 2025, the value of the HQLA buffer was PLN 102.0 bn for the Bank and PLN 102.0 bn for the Group.

The purpose of this policy is also to ensure an adequate structure of funding in relation to the growing scale of the Group’s business by maintaining structural liquidity ratios at pre-defined levels.

The Group uses a suite of additional watch limits and thresholds with respect to the following:

· loan-to-deposit ratio;

· ratios of reliance on wholesale funding, which are used to assess the concentration of foreign currency funding from the wholesale market;

· concentration of deposit;

· level of encumbered assets;

· ratios laid down in CRD IV/CRR – LCR and NSFR;

· survival horizon under stressed conditions;

· the HQLA buffer;

· the buffer of assets which might be liquidated over an intraday horizon.

The internal liquidity limits, including the limits established in the Risk Appetite Statement, are set on the basis of both historical values of the selected liquidity ratios as well as their future values which are estimated against a financial plan. The limits also take into account the results of stress tests.

At least once a year, Santander Bank Polska Group carries out the Internal Liquidity Adequacy Assessment Process (ILAAP), which is designed to ensure that the Group can effectively control and manage liquidity risk. In particular, the ILAAP ensures that the Group:

· maintains sufficient capacity to meet its obligations as they fall due;

· reviews the key liquidity risk drivers and ensures that stress testing reflects these drivers and that they are appropriately controlled;

· provides a record of both the liquidity risk management and governance processes;

· carries out assessment of counterbalancing capacity.

The ILAAP results are subject to approval by the Management Board and the Supervisory Board to confirm adequacy of the liquidity level of Santander Bank Polska Group in terms of liquid assets, prudent funding profile and the Group’s liquidity risk management and control mechanisms.

Risk identification and measurement

The responsibility for identification and measurement of liquidity risk rests with the Risk Management Division, specifically the Financial Risk Department.

The role of the Department is to draft liquidity risk management policies, carry out stress tests and to measure and report on risk on an ongoing basis.

Liquidity is measured by means of the modified liquidity gap, which is designed separately for the PLN and currency positions. The reported future contractual cash flows are subject to modifications based on: statistical analyses of the deposit and credit base behaviour and assessment of product/ market liquidity – in the context of evaluation of the possibility to liquidate Treasury securities by selling or pledging

them in repo transactions or using liquidity support instruments with NBP, as well as the possibility of transaction rolling in the interbank market.

When measuring liquidity risk, the bank additionally analyses the degree of liquidity outflows arising from potential margin calls due to changes in the value of derivative transactions and collateral needs related to secured financing transactions resulting from the downgrade of the bank’s credit rating, among other things.

Concurrently, liquidity is measured in accordance with the CRD IV/ CRR package and in their implementing provisions.

In order to establish a detailed risk profile, the Group conducts stress tests using the nine following scenarios:

· baseline scenario, which assumes non-renewability of wholesale funding;

· idiosyncratic liquidity crisis scenarios (specific to the bank);

· local systemic liquidity crisis scenario;

· global systemic liquidity crisis scenario;

· combined liquidity crisis scenarios (idiosyncratic crisis with local systemic crisis and seperately idiosyncratic crisis withglobal systemic crisis);

· deposit outflows in a one-month horizon;

· scenario of accelerated deposit withdrawals via electronic channels

· ESG liquidity crisis scenario.

For each of the above scenarios, the bank estimates the minimum survival horizon. For selected scenarios, the bank sets survival horizon limits which are subsequently included in the liquidity risk appetite.

In addition, the bank performs stress tests for intraday liquidity as well as reverse stress tests.

Risk reporting

The responsibility for reporting liquidity risk rests with the Risk Management Division, specifically the Financial Risk Department.

The results of liquidity risk measurement are reported by the Financial Risk Department on a daily basis to persons in charge of operational management of the bank’s liquidity and to persons responsible for liquidity risk management (information about intraday and current liquidity, including FX funding ratios and LCR) and – on a monthly basis – to senior executives (other liquidity ratios, including regulatory ratios).

Risk prevention and mitigation

The responsibility for supervision over the liquidity risk management process rests with the Assets and Liabilities Committee (ALCO), which also provides advice to the Management Board. ALCO prepares management strategies and recommends to the Management Board appropriate actions with regard to strategic liquidity management, including strategies of funding the bank’s activity. Day-to-day management of liquidity is delegated to the Financial Management Division. The Assets and Liabilities Management Department, which is a part of the Division, is responsible for developing and updating the relevant liquidity management strategies.

The bank has a liquidity contingency plan approved by the Management Board and Supervisory Board to cater for unexpected liquidity problems, whether caused by external or internal factors.

The plan, accompanied by stress tests, includes different types of scenarios and enables the bank to take adequate and effective actions in response to unexpected external or internal liquidity pressure through:

· identification of threats to the bank’s liquidity on the basis of a set of early warning ratios which are subject to ongoing monitoring;

· effective management of liquidity/ funding, using a set of possible remedial actions and the management structure adjusted to the stressed conditions;

· communication with customers, key market counterparties, shareholders and regulators.

In 2025, Santander Bank Polska Group focused on maintaining an optimal financing structure. With falling market interest rates in PLN and of the persistent liquidity surplus on the market we observed moderate competition for customer deposits in the banking sector. As at 31 December 2025, the loan-to-deposit ratio was 68% compared to 75% as at 31 December 2024, the consolidated Liquidity Coverage Ratio was 220%, and 216% as at 31 December 2024. The Bank also ensured proper diversification of financing sources by limiting funds obtained from the wholesale market and from the strategic investor. The concentration ratios of financing from the wholesale market for the Bank as at 31 December 2025 amounted to 36.6% compared to 33.7% at the end of 2024, while the financing ratio from the strategic investor amounted to 0% (all financing was repaid) and it hasn't changed over the year.

The tables below show the cumulated liquidity gap for Santander Bank Polska S.A. Group as at 31 December 2025 and in the comparable period (by nominal value).

31.12.2025	A'vista	up to 1 month	from 1 to 3 months	from 3 to 6 months	from 6 to 12 months	from 1 to 2 years	from 2 to 5 years	above 5 years	TOTAL
Assets,	32 797 580	22 413 915	18 628 737	9 979 523	21 679 032	34 634 506	69 224 603	76 093 025	285 450 921
including:
-Cash and cash equivalents	15 219 424	15 134 994	-	-	-	-	-	-	30 354 418
-Loans and advances to banks	-	-	5 000	10 000	100 000	2 189 420	-	-	2 304 420
-Loans and advances to customers	17 032 280	5 521 523	9 301 098	8 096 031	11 786 392	19 671 792	33 922 223	57 119 990	162 451 327
-Investment securities	-	507 294	2 990 907	1 385 611	7 735 969	12 773 295	33 979 556	18 973 035	78 345 667
Liabilites	166 139 486	40 890 566	26 053 958	3 587 514	3 622 808	5 922 094	1 633 910	3 472 504	251 322 841
including:
- Sell-buy-back transactions	-	2 579 714	-	-	-	-	-		2 579 714
- Deposits from banks	1 583 623	271 491	454 492	78 923	160 375	136 438	130 000	-	2 815 341
- Deposits from customers	164 555 864	34 264 360	25 019 467	3 433 341	1 743 594	319 407	503 910	130 705	229 970 648
- Debt securities in issue	-	3 775 000	580 000	-	1 800 000	4 900 000	-	3 341 799	14 396 799
- Subordinated liabilities	-	-	-	-		579 481	1 000 000	-	1 579 481
Contractual liquidity mismatch/ gap	(133 341 907)	(18 476 650)	(7 425 221)	6 392 008	18 056 224	28 712 412	67 590 693	72 620 521	34 128 079
Cumulative liquidity gap	(133 341 907)	(151 818 557)	(159 243 779)	(152 851 770)	(134 795 546)	(106 083 134)	(38 492 442)	34 128 079	-
Off balance positions, of which:	57 927 473	8 451 651	1 088 123	267 323	667 937	641 242	380 924	1 166 057	70 590 730
-guarantees & letters of credits	16 686 917	-	-	-	-	-	-	-	16 686 917

* The vast majority of other financial liabilities are within the range of 1 month

31.12.2024 restated*	A'vista	up to 1 month	from 1 to 3 months	from 3 to 6 months	from 6 to 12 months	from 1 to 2 years	from 2 to 5 years	above 5 years	TOTAL
Assets,	30 472 121	24 809 518	18 000 451	15 931 558	23 836 286	31 931 701	67 395 754	69 108 307	281 485 696
including:
- Cash and cash equivalents	11 558 138	17 331 392	-	-	-	-	-	-	28 889 530
-Loans and advances to banks	789 049	34 651	1 709 200	1 281 900	-	-	-	290 000	4 104 800
-Loans and advances to customers	18 124 932	7 013 126	10 833 113	10 323 920	13 585 426	21 458 086	38 002 003	54 650 305	173 990 911
-Investment securities	-	119 928	2 504 989	3 095 378	10 250 859	10 473 616	29 393 751	14 168 002	70 006 524
Liabilites	159 022 784	36 776 904	31 404 140	8 131 225	7 269 350	4 332 119	5 155 407	110 757	252 202 687
including:
- Sell-buy-back transactions	-	1 198 068	-	-	-	-	-	-	1 198 068
- Deposits from banks	2 101 134	423 790	1 466 046	235 342	248 328	348 350	416 438	-	5 239 427
- Deposits from customers	156 921 651	34 953 553	29 441 940	6 778 802	2 766 088	343 276	216 599	12 285	231 434 194
- Debt securities in issue	-	200 000	459 933	1 079 332	4 179 391	3 068 637	2 653 794	98 472	11 739 559
- Subordinated liabilities	-	-	-	-	-	512 760	1 685 828	-	2 198 588
- Lease liabilities	-	1 493	36 222	37 749	75 542	59 096	182 749	-	392 851
Contractual liquidity mismatch/ gap	(128 550 664)	(11 967 387)	(13 403 689)	7 800 333	16 566 936	27 599 582	62 240 347	68 997 551	29 283 009
Cumulative liquidity gap	(128 550 664)	(140 518 050)	(153 921 740)	(146 121 407)	(129 554 471)	(101 954 888)	(39 714 542)	29 283 009	-
Off balance positions, of which:	59 628 874	6 285 776	934 587	587 866	761 252	371 504	633 572	23	69 203 453
-guarantees & letters of credits	21 341 713	-	-	-	-	-	-	-	21 341 713

*Data restated following changes to the presentation of cash and cash equivalents; details are presented in Note 2.5.

** The vast majority of other financial liabilities are within the range of 1 month

The tables below show maturity analysis of financial liabilities and receivables for Santander Bank Polska Group as at 31 December 2025 and in the comparable period (the undiscounted cash flow – capital and interests).

31.12.2025	A'vista	up to 1 month	from 1 to 3 months	from 3 to 6 months	from 6 to 12 months	from 1 to 2 years	from 2 to 5 years	above 5 years	TOTAL
Assets	32 801 423	23 116 025	20 078 061	12 065 463	25 474 204	41 337 862	84 513 011	112 562 503	351 948 552
including:
- Cash and cash equivalents	15 219 452	15 134 994	-	-	-	-	-	-	30 354 446
-Loans and advances to banks	-	-	5 000	10 000	100 000	2 189 420	-	-	2 304 420
-Loans and advances to customers	17 036 067	6 212 526	10 725 720	10 179 835	15 551 224	26 255 245	48 677 752	93 404 309	228 042 677
-Investment securities	-	516 386	2 990 907	1 387 744	7 766 309	12 893 198	34 512 435	19 158 194	79 225 174
Liabilities	166 498 091	41 074 062	26 384 698	3 821 263	3 893 282	6 258 982	1 886 837	3 561 008	253 378 223
including:
- Repurchase agreement transactions	-	2 581 698	-	-	-	-	-	-	2 581 698
- Liabilities to banks	1 659 451	454 317	515 257	154 252	160 375	136 438	130 000	-	3 210 089
- Liabilities to customers	164 831 261	33 864 408	25 213 539	3 460 005	1 694 382	315 977	509 428	130 772	230 019 772
- Own emissions	-	3 778 635	633 968	135 388	1 960 025	5 081 798	-	3 430 237	15 020 050
- Subordinated liabilities	-	-	15 265	30 716	41 415	650 802	1 025 508	-	1 763 706
Contractual liquidity gap	(133 696 668)	(17 958 037)	(6 306 637)	8 244 199	21 580 923	35 078 880	82 626 174	109 001 495	98 570 329
Cummulated contractual liquidity gap	(133 696 668)	(151 654 705)	(157 961 342)	(149 717 143)	(128 136 220)	(93 057 340)	(10 431 166)	98 570 329	-
Off Balance positions, of which:	57 927 473	8 451 651	1 088 123	267 323	667 937	641 242	380 924	1 166 057	70 590 730
-guarantees & letters of credits	16 686 917	-	-	-	-	-	-	-	16 686 917

* The vast majority of other financial liabilities are within the range of 1 month

The table below presents cash flows from derivative financial instruments whose valuation was negative at the reporting date. The cash flows include IRS, FRA, CIRS, Fx Swap, Fx Forward and options transactions. The data below include undiscounted cash flow amounts from these transactions according to the contract dates. In the case of options, the valuation amount at the reporting date is included:

31.12.2025	up to 1 month	from 1 to 3 months	from 3 to 6 months	from 6 to 12 months	from 1 to 2 years	from 2 to 5 years	above 5 years	Total
Inflows	24 497 999	27 231 272	16 037 478	22 372 658	15 831 044	9 189 132	20 443 117	135 602 698
Outflows	25 066 906	27 746 177	16 350 596	22 616 198	15 987 540	9 247 987	20 814 510	137 829 913

31.12.2024 restated*	A'vista	up to 1 month	from 1 to 3 months	from 3 to 6 months	from 6 to 12 months	from 1 to 2 years	from 2 to 5 years	above 5 years	TOTAL
Assets	30 477 174	25 641 342	20 017 555	18 752 049	28 824 575	40 125 437	83 963 411	106 217 329	354 018 873
including:
- Cash and cash equivalents	11 558 138	17 331 445	-	-	-	-	-	-	28 889 582
-Loans and advances to banks	704 734	9 926	1 709 200	1 281 900	-	-	-	290 000	3 995 760
-Loans and advances to customers	18 214 300	7 781 987	12 826 369	13 033 378	18 406 702	29 414 137	54 123 807	91 736 827	245 537 506
-Investment securities	-	139 928	2 504 989	3 181 549	10 417 874	10 711 300	29 839 604	14 190 502	70 985 760
Liabilities	159 352 101	37 065 862	31 872 614	8 579 705	7 744 425	4 763 633	5 399 352	110 832	254 888 525
including:
- Repurchase agreement transactions	-	1 199 153	-	-	-	-	-	-	1 199 153
- Liabilities to banks	2 101 179	425 401	1 484 091	236 642	249 372	348 633	418 868	-	5 264 186
- Liabilities to customers	157 250 922	35 228 086	29 803 984	6 938 959	2 857 089	371 299	239 969	12 360	232 702 668
- Own emissions	-	211 521	570 219	1 354 142	4 545 466	3 490 311	2 834 540	98 472	13 104 670
- Subordinated liabilities	-	-	-	3 778	3 799	520 337	1 697 183	-	2 225 097
- Lease liabilities	-	1 702	14 320	46 184	88 700	33 052	208 792	-	392 750
Contractual liquidity gap	(128 874 927)	(11 424 520)	(11 855 059)	10 172 344	21 080 150	35 361 804	78 564 059	106 106 497	99 130 348
Cummulated contractual liquidity gap	(128 874 927)	(140 299 447)	(152 154 506)	(141 982 163)	(120 902 013)	(85 540 208)	(6 976 149)	99 130 348	-
Off Balance positions Total, of which:	59 628 874	6 285 776	934 587	587 866	761 252	371 504	633 572	23	69 203 453
-guarantees & letters of credits	21 341 713	-	-	-	-	-	-	-	21 341 713

**Data restated following changes to the presentation of cash and cash equivalents; details are presented in Note 2.5.

* The vast majority of other financial liabilities are within the range of 1 month

In the tables above, the liquidity gap analysis does not take into account the effect of uncertainty related to flows related to CHF-indexed mortgage loans. Due to the risks described in note 48, cash flows may occur in terms, currencies and amounts other than currently included in In the opinion of the bank, however, this should not cause problems related to compliance with the liquidity regulations of the Group.

The table below presents cash flows from derivative financial instruments whose valuation was negative at the reporting date. The cash flows include IRS, FRA, CIRS, Fx Swap, Fx Forward and options transactions. The data below include undiscounted cash flow amounts from these transactions according to the contract dates. In the case of options, the valuation amount at the reporting date is included:

31.12.2024	up to 1 month	from 1 to 3 months	from 3 to 6 months	from 6 to 12 months	from 1 to 2 years	from 2 to 5 years	above 5 years	Total
Inflows	33 273 299	27 603 603	24 327 140	34 704 267	20 832 004	14 126 634	22 084 033	176 950 981
Outflows	34 846 335	30 872 689	29 358 326	32 504 710	23 822 273	15 672 159	24 800 934	191 877 424

The Group uses secured instruments to fund its activity to a limited degree only. Based on existing contractual provisions, there is no requirement to post additional collateral for these instruments in the event of a rating downgrade.

5. Capital management

Introduction

The policy of Santander Bank Polska S.A. Group is to maintain a level of capital adequate to the type and scale of its operations and to the level of risk incurred.

The level of own funds required to ensure safe operations of the bank and Santander Bank Polska Group and capital requirements estimated for unexpected losses is determined in accordance with:

· Regulation (EU) No. 575/2013 of the European Parliament and of the Council of June 26, 2013, on prudential requirements for credit institutions and investment firms, amending Regulation (EU) No. 648/2012, as amended, including by Regulation (EU) 2019/876 of the European Parliament and of the Council of May 20, 2019, and Regulation (EU) 2024/1623 of the European Parliament and of the Council of May 31, 2024 (hereinafter referred to as CRR).

The Management Board is accountable for capital management, calculation and maintenance processes, including the assessment of capital adequacy in different economic conditions and the evaluation of stress test results and their impact on internal and regulatory capital and capital ratios.

The Bank Capital Committee regular assessment of the capital adequacy of the bank and Santander Bank Polska Group, including in extreme conditions, the monitoring of the actual and required capital levels and the initiation of transactions affecting these levels.

Pursuant to the Bank's disclosure policy, detailed information on the level of own funds and capital requirements is provided in the report entitled ‘Information on the capital adequacy of the Santander Bank Polska S.A. Capital Group as at 31 December 2025’.

According to information provided internally to the Bank's key management in 2025, the Bank and Santander Bank Polska Group met all regulatory requirements regarding capital management.

Capital Policy

As at 31 December 2025, the minimum capital ratios, in accordance with the provisions of the CRR Regulation and the Act on Macroprudential Supervision, as well as supervisory recommendations regarding Pillar II surcharges, at the level of the Bank and Santander Bank Polska S.A. Group, are as follows:

· Tier 1 capital ratio of 10.99%;

· Total capital ratio of 12.99%;

The aforementioned capital ratios take into account:

· The minimum capital ratios as required by the CRR: Common Equity Tier 1 ratio at 4.5%, Tier 1 capital ratio at 6.0% and total capital ratio at 8.0%.

· On 11 March 2025, the Bank received a decision from the Polish Financial Supervision Authority stating that the decision of 21 December 2023 ordering the Bank to comply, on a consolidated basis, with an additional own funds requirement in excess of the amount calculated in accordance with the CRR, by maintaining own funds to cover the additional capital requirement to secure the risk arising from mortgage-backed foreign currency loans and advances to households. Based on the decision issued by the Polish Financial Supervision Authority on November 5, 2019, earlier recommendations concerning Santander Bank Polska S.A. maintaining an additional capital requirement related to the portfolio of foreign currency mortgage loans for households at the individual level also expired.

· Capital buffer due to the classification of Santander Bank Polska S.A. as another systemically important institution. Pursuant to the letter of 19 December 2017, Santander Bank Polska S.A. was identified as another systemically important institution and an additional capital buffer was imposed on it. Based on the decision of the Polish Financial Supervision Authority of 21 November 2025, Santander Bank Polska S.A. maintains additional own funds of 1.5 p.p. The Santander Bank Polska S.A. Group maintains its capital buffer at the same level.

· The buffer is maintained in accordance with the Act on Macroprudential Supervision. In line with the adjustment to the CRR regulations in 2019, this buffer reached its maximum value of 2.50 p.p.

· The countercyclical buffer was introduced in accordance with the Macroprudential Supervision Act and amended by the Minister of Finance by way of a regulation. At the meeting held on 14 June 2024, the Financial Stability Committee passed a resolution on the recommendation for setting the countercyclical capital buffer for institutions that have exposures in the Republic of Poland at the level of:

• 1% – after 12 months;

• 2% – after 24 months

· from the date of announcement of the relevant regulation by the Minister of Finance. The Regulation of the Minister of Finance of 18 September 2024 on the countercyclical buffer rate entered into force on 24 September 2024. Pursuant to this Regulation, as of 25 September 2025, the countercyclical buffer rate is 1%.

· The institution-specific countercyclical buffer for Santander Bank Polska S.A. as at 31 December 2025 at the consolidated level was 0.99%. The Santander Bank Polska S.A. Group calculates the institution-specific countercyclical buffer rate in accordance with the provisions of the Act of 5 August 2015 on macroprudential supervision of the financial system and crisis management in the financial system.

· On 25 November 2025, the Bank received a letter from the Polish Financial Supervision Authority informing it that in the supervisory assessment process, the Bank's sensitivity to the possible materialisation of stress scenarios affecting the level of own funds and risk exposure was assessed as low. The total capital add-ons recommended under Pillar II, offset by the buffer requirement, amount to 0.00 p.p. at the individual level and 0.00 p.p. at the consolidated level. Therefore, the Polish Financial Supervision Authority does not impose an additional P2G capital charge to absorb potential losses resulting from extreme conditions.

The table below presents the minimum capital ratios at the consolidated level as at the end of 2025 and in the comparative period.

Components of the minimum capital requirement		31.12.2025	31.12.2024
Minimal capital ratios	Common Equity Tier 1 capital ratio	4.5%	4.5%
Minimal capital ratios	Tier 1 capital ratio	6%	6%

	Total capital ratio	8%	8%
Additional capital requirement for Santander Bank Polska relating to the portfolio of FX mortgage loans for households	Santander Bank Polska	no requirement	no requirement
	Santander Bank Polska Capital Group:
	· for total capital ratio:	ü 0 p.p.	ü 0.013 p.p.
	· Tier 1 capital ratio:	ü 0 p.p.	ü 0.010 p.p.
	· for Common Equity Tier 1 capital ratio:	ü 0 p.p	ü 0.007 p.p
The capital buffer for Santander Bank Polska as other systemically important institution		ü 1.5 p.p.	ü 1 p.p.
The capital conservation buffer maintained in accordance with the Macroprudential Supervision Act		ü 2.5 p.p.	ü 2.5 p.p.
The systemic risk buffer(SRB)		ü 0 p.p.	ü 0 p.p.
The institution specific Countercyclical capital buffer		ü 0.99 p.p.	ü 0.02 p.p.
The bank's sensitivity to an unfavorable macroeconomic scenario measured using the supervisory stress tests results (P2G)	Santander Bank Polska	ü 0 p.p.	ü 0 p.p.
	Santander Bank Polska Capital Group	ü 0 p.p.	ü 0 p.p.

Regulatory Capital

The capital requirement of the Santander Bank Polska S.A. Capital Group is determined in accordance with Part Three of Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms, amending Regulation (EU) No 648/2012, which constituted the legal basis as at the reporting date, i.e. 31 December 2025.

Santander Bank Polska uses the standardised approach to calculate the capital requirement for credit risk, market risk and operational risk. According to this approach, the total capital requirement for credit risk is calculated as the sum of risk-weighted exposures multiplied by 8%. The exposure value for these assets is equal to the carrying amount, while the value of off-balance sheet liabilities corresponds to their balance sheet equivalent. Risk-weighted exposures are calculated by means of applying risk weights to all exposures in accordance with the CRR.

The table below presents the calculation of the capital ratio for Santander Bank Polska S.A. Group as at 31 December 2025 and in the comparative period.

	31.12.2025	31.12.2024*
Total own funds	29 595 808,9	29 073 637,1
Reductions	3 062 004,9	2 495 587,3
Own funds after reductions (I-II)	26 533 804,0	26 578 049,8
Tier I Capital	25 884 852,7	25 249 667,8

*The values for the relevant periods include profits recognised as own funds in accordance with the applicable EBA guidelines. They also include data from Santander Consumer Bank S.A. and its subsidiaries.

Internal Capital

Notwithstanding regulatory methods of measuring capital requirements, Santander Bank Polska S.A. conducts an independent assessment of current and future capital adequacy as part of its internal capital adequacy assessment process (ICAAP). The purpose of this process is to ensure that the level of own funds maintained and their nature guarantee the solvency and stability of the Bank and the Santander Bank Polska S.A. Group.

Capital adequacy assessment is one of the key elements of the Bank's strategy, the process of determining the acceptable level of risk and the planning process.

In the ICAAP process, the Group uses a statistical approach to estimate losses for specific types of measurable risk, e.g. credit and market risk, and performs a qualitative assessment for significant types of risk not covered by the model, e.g. reputation and compliance risk.

As part of the internal capital estimation process for credit risk, risk parameters are used to represent the probability of default (PD) by Santander Bank Polska S.A. customers and the amount of potential losses (LGD loss given default) resulting from default.

The Group also conducts an internal assessment of capital requirements under extreme conditions, taking into account various macroeconomic scenarios.

Internal capital estimation models are subject to annual assessment and verification in order to adjust them to the scale and profile of Santander Bank Polska S.A.’s operations, take into account new risk categories and management assessments.

The review and assessment is carried out by the Bank's risk management committees, including the Capital Committee and the Model Risk Management Committee.

Subordinated Liabilities

As part of its strategy to increase Tier II supplementary capital, on 22 May 2017, the Bank issued subordinated bonds with a nominal value of EUR 137.1 million and received approval to include them in Tier II capital by decision of the Polish Financial Supervision Authority dated 19 October 2017. From 22 May 2022, it is subject to linear amortisation as provided for in Article 64 of the CRR due to the last 5 years of its maturity.

On 12 June 2018, Santander Bank Polska S.A. received approval from the Polish Financial Supervision Authority to classify the Series F subordinated bonds issued on 5 April 2018 by Santander Bank Polska S.A. with a total nominal value of PLN 1 billion as Tier II capital instruments of the Bank. From 5 April 2023, it is subject to straight-line amortisation as provided for in Article 64 of the CRR due to the last 5 years of its maturity.

For more information on subordinated liabilities, see Note 34.

6. Net interest income

Interest income and income similar to interest	1.01.2025-31.12.2025	1.01.2024-31.12.2024* represented
Interest income on financial assets measured at amortised cost	14 559 050	14 032 222
Loans and advances to enterprises	4 461 067	4 688 376
Loans and advances to individuals, of which:	6 344 172	6 358 606
Home mortgage loans	3 770 732	3 743 245
Loans and advances to banks	798 360	887 208
Loans and advances to public sector	133 825	108 816
Reverse repo transactions	652 639	667 909
Debt securities	2 077 979	1 380 452
Interest recorded on hedging IRS	91 008	(59 145)
Interest income on financial assets measured at fair value through other comprehensive income	1 849 712	1 876 743
Loans and advances to enterprises	272 133	283 496
Loans and advances to public sector	15 527	16 790
Debt securities	1 562 052	1 576 457
Income similar to interest - financial assets measured at fair value through profit or loss	102 593	54 536
Loans and advances to individuals	200	1 399
Debt securities	102 393	53 137
Income similar to interest on finance leases	656 841	664 699
Total income	17 168 196	16 628 200

*Represented data presenting continued operations following the separation of the discontinued operations; details are presented in Note 48.

The impact of payment deferrals on the Group’s net interest income in 2025 and 2024 totalled PLN nil k and PLN 134 500 k respectively.

It was recognised as an adjustment to the gross carrying amount of mortgage loans due to the change of expected cash flows and a decrease in interest income.

Interest expenses	1.01.2025-31.12.2025	1.01.2024-31.12.2024* represented
Interest expenses on financial liabilities measured at amortised cost	(4 465 370)	(4 357 786)
Liabilities to individuals	(1 554 756)	(1 572 468)
Liabilities to enterprises	(1 229 609)	(1 176 388)
Repo transactions	(344 760)	(271 877)
Liabilities to public sector	(307 751)	(373 973)
Liabilities to banks	(136 457)	(195 194)
Lease liability	(20 308)	(19 356)
Subordinated liabilities and issue of securities	(871 729)	(748 530)
Total costs	(4 465 370)	(4 357 786)
Net interest income	12 702 826	12 270 414

*Represented data presenting continued operations following the separation of the discontinued operations; details are presented in Note 48.

7. Net fee and commission income

Fee and commission income	1.01.2025-31.12.2025	1.01.2024-31.12.2024* represented
Electronic and payment services	304 210	295 820
Account maintenance and payment transactions	408 379	400 001
Asset management fees	347 402	292 214
Foreign exchange commissions	912 341	871 056
Credit commissions incl. factoring commissions and other	401 900	382 936
Insurance commissions	259 543	247 960
Commissions from brokerage activities	196 061	155 653
Credit cards	92 786	88 780
Card fees (debit cards)	465 440	441 454
Off-balance sheet guarantee commissions	169 381	144 956
Finance lease commissions	22 940	13 524
Issue arrangement fees	26 712	16 746
Distribution fees	23 077	20 167
Total	3 630 172	3 371 267

*Represented data presenting continued operations following the separation of the discontinued operations; details are presented in Note 48.

Fee and commission expenses	1.01.2025-31.12.2025	1.01.2024-31.12.2024* represented
Electronic and payment services	(95 214)	(94 061)
Account maintenance and payment transactions	(16 332)	(13 698)
Distribution fees	(13 751)	(10 693)
Commissions from brokerage activities	(21 130)	(15 328)
Credit cards	(17 529)	(10 166)
Card fees (debit cards)	(159 517)	(136 863)
Credit agency fees	(50 215)	(28 425)
Other agency fees**	(68 367)	(60 762)
Insurance commissions	(9 445)	(11 782)
Finance lease commissions	(46 188)	(41 732)
Asset management fees and other costs	(2 757)	(3 278)
Commissions paid to other banks	(12 476)	(15 454)
Off-balance sheet guarantee commissions	(67 573)	(53 593)
Brokerage fees	(19 592)	(21 050)
Other	(81 569)	(69 750)
Total	(681 655)	(586 635)
Net fee and commission income	2 948 517	2 784 632

* Represented data presenting continued operations following the separation of the discontinued operations; details are presented in Note 48.

** To better reflect the nature of the transactions, the Group has changed the presentation of the Cost of agency fees by creating a separate line item: “Other agency fees”. The data for 2024 have been re-presented for comparison purposes. Previously, the above costs were presented in the following line items: “Account maintenance and payment transactions”, “Credit agency fees” and “Other”.

Included above is fee and commission income on credits, credit cards, off-balance sheet guarantees and leases of PLN 687,007 k (31.12.2024: PLN 630,196k) and fee and commission expenses on credit cards, leases and paid to credit agents of PLN (113,932) k (31.12.2024: PLN (80,323)k) other than fees included in determining the effective interest rate, relating to financial assets and liabilities not carried at air value through profit and loss.

8. Dividend income

Dividend income	1.01.2025-31.12.2025	1.01.2024-31.12.2024* represented
Dividends income from investment securities measured at fair value through other comprehensive income	11 267	10 481
Dividends income from equity financial assets held for trading	4 634	5 187
Total	15 901	15 668

*Represented data presenting continued operations following the separation of the discontinued operations; details are presented in Note 48.

9. Net trading income and revaluation

Net trading income and revaluation	1.01.2025-31.12.2025	1.01.2024-31.12.2024* represented
Derivative instruments	(28 534)	192 830
Interbank FX transactions and other FX related income	96 801	(83 157)
Net gains on sale of equity securities measured at fair value through profit or loss	58 004	(8 926)
Net gains on sale of debt securities measured at fair value through profit or loss	137 859	93 158
Change in fair value of loans and advances mandatorily measured at fair value through profit or loss	2 473	972
Total	266 603	194 877

*Represented data presenting continued operations following the separation of the discontinued operations; details are presented in Note 48.

The amounts include CVA and DVA adjustments which in 2025 and 2024 totalled PLN 481k and PLN 227k respectively.

10. Gains (losses) from other financial securities

Gains (losses) from other financial securities	1.01.2025-31.12.2025	1.01.2024-31.12.2024* represented
Net gains on sale of debt securities measured at fair value through other comprehensive income	15 397	14 481
Net gains on sale of debt securities measured at fair value through profit or loss	(20)	1
Total profit (losses) on financial instruments	15 377	14 482
Change in fair value of hedging instruments	(112 162)	(28 645)
Change in fair value of underlying hedged positions**	107 908	37 582
Total profit (losses) on hedging and hedged instruments	(4 254)	8 937
Total	11 123	23 419

*Represented data presenting continued operations following the separation of the discontinued operations; details are presented in Note 48.

**Details in note 43

11. Other operating income

Other operating income	1.01.2025-31.12.2025	1.01.2024-31.12.2024* represented
Income from services rendered	20 084	30 067
Release of provision for legal cases and other assets	13 832	29 035
Recovery of other receivables (expired, cancelled and uncollectable)	35 783	29
Received compensations, penalties and fines	2 716	2 071
Gains on lease modifications	2 721	2 561
Settlements of leasing agreements	13	3 642
Income from claims received from the insurer	5 038	6 210
Income from additional charges for leasing contracts	12 683	12 914
Other	30 822	27 537
Total	123 692	114 066

*Represented data presenting continued operations following the separation of the discontinued operations; details are presented in Note 48.

12. Impairment allowances for expected credit losses

Impairment allowances for expected credit losses on loans and advances measured at amortised cost	1.01.2025-31.12.2025	1.01.2024-31.12.2024* represented
Charge for loans and advances to banks	(141)	52
Stage 1	(141)	52
Stage 2	-	-
Stage 3	-	-
POCI	-	-
Charge for loans and advances to customers	(597 208)	(759 419)
Stage 1	(30 030)	2 964
Stage 2	(239 950)	(374 725)
Stage 3	(392 878)	(505 690)
POCI	65 650	118 032
Recoveries of loans previously written off	6 003	7 919
Stage 1	-	-
Stage 2	-	-
Stage 3	6 003	7 919
POCI	-	-
Off-balance sheet credit related facilities	5 448	27 543
Stage 1	654	7 620
Stage 2	1 790	4 103
Stage 3	3 004	15 820
POCI	-	-
Total	(585 898)	(723 905)

* Represented data presenting continued operations following the separation of the discontinued operations; details are presented in Note 48.

13. Employee costs

Employee costs	1.01.2025-31.12.2025	1.01.2024-31.12.2024* represented
Salaries and bonuses	(1 914 533)	(1 785 539)
Salary related costs	(324 616)	(299 605)
Cost of contributions to Employee Capital Plans	(16 400)	(14 636)
Staff benefits costs	(56 891)	(55 558)
Professional trainings	(12 256)	(11 396)
Retirement fund, holiday provisions and other employee costs	(4 433)	1 659
Total	(2 329 129)	(2 165 075)

*Represented data presenting continued operations following the separation of the discontinued operations; details are presented in Note 48

14. General and administrative expenses

General and administrative expenses	1.01.2025-31.12.2025	1.01.2024-31.12.2024* represented
Maintenance of premises	(115 155)	(122 889)
Cost of short-term lease, low-value assets lease and other payments	(8 610)	(10 758)
Non-tax deductible VAT - lease	(36 159)	(34 597)
Marketing and representation	(143 287)	(148 305)
IT systems costs	(464 854)	(426 323)
Cost of BFG, KNF and KDPW	(401 770)	(274 572)
Postal and telecommunication costs	(54 545)	(55 486)
Consulting and advisory fees	(94 933)	(62 632)
Cars, transport expenses, carriage of cash	(33 754)	(42 804)
Other external services	(268 353)	(255 951)
Stationery, cards, cheques etc.	(14 256)	(14 070)
Sundry taxes and charges	(42 047)	(44 479)
Data transmission	(21 283)	(20 456)
KIR, SWIFT settlements	(45 822)	(41 889)
Security costs	(15 797)	(14 987)
Costs of repairs	(10 726)	(10 080)
Other	(26 058)	(26 690)
Total	(1 797 409)	(1 606 968)

*Represented data presenting continued operations following the separation of the discontinued operations; details are presented in Note 48

Amounts payable to market regulators (BFG, KNF and KDPW) totalled PLN (401,770)k and were higher than in 2024 due to the reinstatement (after two years) of a quarterly contribution to the BFG guarantee fund totalling PLN (83,685)k, and higher annual contribution to the BFG bank resolution fund, which totalled PLN (271,442)k in accordance with the BFG Council’s resolution of 21 March 2025. Total contributions payable by the Group to the Bank Guarantee Fund were PLN (355,127) k, as compared to PLN (233 075) k in 2024 r.

15. Other operating expenses

Other operating expenses	1.01.2025-31.12.2025	1.01.2024-31.12.2024* represented
Charge of provisions for legal cases and other assets	(45 849)	(60 650)
Impairment loss on property, plant, equipment, intangible assets covered by lease agreements and other fixed assets	(5 031)	(15 539)
Gain on sales or liquidation of fixed assets, intangible assets and assets for disposal	(8 157)	(10 410)
Costs of purchased services	(2 895)	(7 835)
Other membership fees	(1 081)	(1 795)
Paid compensations, penalties and fines	(242)	(186)
Donations paid	(4 146)	(9 004)
Other	(64 520)	(32 091)
Total	(131 921)	(137 510)

*Represented data presenting continued operations following the separation of the discontinued operations; details are presented in Note 48.

16. Corporate income tax

Corporate income tax*	1.01.2025-31.12.2025	1.01.2024-31.12.2024 represented**
Current tax charge in the income statement	(1 905 983)	(1 578 159)
Deferred tax charge in the income statement	168 166	(331 118)
Adjustments from previous years for current and deferred tax	11 041	15 505
Total tax on gross profit	(1 726 776)	(1 893 772)

*) It refers to continuing operations, i.e. it does not include tax due to the sale of discontinued operations.

**) Represented data presenting continued operations following the separation of the discontinued operations; details are presented in Note 48.

Corporate total tax charge information	1.01.2025-31.12.2025	1.01.2024-31.12.2024 represented **
Profit before tax on continued operations	8 259 890	7 234 098
Tax rate	19%	19%
Tax calculated at the tax rate on continued operations	(1 569 379)	(1 374 479)
Non-tax-deductible expenses	(21 186)	(19 443)
Cost of legal risk associated with foreign currency mortgage loans	(107 659)	(312 043)
The fee to the Bank Guarantee Fund	(67 474)	(44 284)
Tax on financial institutions	(158 949)	(147 817)
Non-taxable income	3 021	2 929
Non-tax deductible bad debt provisions	(14 983)	(24 470)
Non-taxable income in respect of investments in associates accounted for using the equity method	18 641	20 626
Impact of the recalculation of deferred tax at new CIT rates	173 541	-
Adjustment of prior years tax	11 041	15 505
Other	6 610	(10 296)
Total corporate income tax on continued operation	(1 726 776)	(1 893 772)

**) Represented data presenting continued operations following the separation of the discontinued operations; details are presented in Note 48.

The tax of PLN 579 721 k on the sale of SCB shares is recognised in the net profit/loss from discontinued operations.

Deferred tax recognised in other comprehensive income	31.12.2025	31.12.2024
Relating to valuation of debt investments measured at fair value through other comprehensive income	25 130	154 717
Relating to valuation of equity investments measured at fair value through other comprehensive income	(105 721)	(82 677)
Relating to cash flow hedging activity	(230 685)	(17 258)
Relating to valuation of defined benefit plans	(1 121)	(196)
Total	(312 397)	54 586

At the start of 2025, the act implementing a global top-up tax in Poland became effective. As the Group is required to apply the provisions of this act, it assessed their potential impact based on the latest financial statements and tax calculations of the Group companies. In the Group’s opinion, the provisions on top-up tax will not result in an additional tax charge in 2025 and 2026..

Pursuant to applicable laws, significant changes were introduced to the taxation of the banking sector in Poland, effective as of 1 January 2026.

They include an increase in the standard corporate income tax rate for banks from 19% to 30% from 1 January 2026, followed by a gradual reduction to 26% in 2027 and a target level of 23% from 2028 onwards.

Due to the change of CIT rates applicable as of 1 January 2026 and in 2027–2028, the Bank recalculated deferred tax items as at

31 December 2025.

The impact of the recalculation on the deferred tax totals PLN 173m.

The comparative data have not been restated.

17. Earnings per share

	1.01.2025- 31.12.2025	1.01.2024- 31.12.2024 * restated
Profit for the period on continued operation attributable to ordinary shares	6 462 914	5 283 849
Weighted average number of ordinary shares	102 189 314	102 189 314
Earnings per share on continued operation(PLN)	63,24	51,71
Profit for the period on continued operation attributable to ordinary shares	6 462 914	5 283 849
Weighted average number of ordinary shares	102 189 314	102 189 314
Diluted earnings per share on continued operation (PLN)	63,24	51,71
Profit for the period attributable to ordinary shares	6 478 814	5 212 731
Weighted average number of ordinary shares	102 189 314	102 189 314
Earnings per share (PLN)	63,40	51,01
Profit for the period attributable to ordinary shares	6 478 814	5 212 731
Weighted average number of ordinary shares	102 189 314	102 189 314
Diluted earnings per share (PLN)	63,40	51,01

*) Represented data presenting continued operations following the separation of the discontinued operations; details are presented in Note 48.

18. Cash and cash equivalents

Cash and cash equivalents	31.12.2025	31.12.2024* restated	1.01.2024* restated
Cash and balances with central banks	13 696 120	10 575 107	8 417 519
Loans and advances to banks	2 225 993	4 781 823	9 270 845
Reverse sale and repurchase agreements to banks	8 586 993	7 650 952	10 640 461
Debt securities measured at fair value through other comprehensive income	5 995 633	5 995 624	6 246 368
Total	30 504 739	29 003 506	34 575 193

*Data restated following changes to the presentation of cash and cash equivalents; details are presented in Note 2.5.

Santander Bank Polska SA holds an obligatory reserve in a current account in the National Bank of Poland. The figure is calculated at a fixed percentage of minimal statutory reserve of the monthly average balance of the customers’ deposits, which was 3.5% as at 31.12.2025 and 31.12.2024.

In accordance with the applicable regulations, the amount of the calculated provision is reduced by the equivalent of EUR 500 k.

19. Loans and advances to banks

Loans and advances to banks	31.12.2025	31.12.2024* restated	1.01.2024* restated
Measured at amortised cost
Loans and advances	1 800 748	4 031 141	262 027
Current accounts	15 177	176	1 195
Gross receivables measured at amortised cost	1 815 925	4 031 317	263 222
Measured at fair value through other comprehensive income
Loans	556 022	-	-
Gross receivables measured at fair value through other comprehensive income	556 022	-	-
Gross receivables	2 371 947	4 031 317	263 222
Allowance for expected credit losses	(299)	(152)	(227)
Total	2 371 648	4 031 165	262 995

*Data restated following changes to the presentation of cash and cash equivalents; details are presented in Note 2.5.

Fair value of loans and advances to banks is presented in note 46.

Loans and advances to banks measured at amortised cost 31.12.2025
Gross carrying amount	Stage 1	Stage 2	Stage 3	POCI	Total
As at the beginning of the period	4 031 317	-	-	-	4 031 317
Transfers
Transfer to Stage 1	-	-	-	-	-
Transfer to Stage 2	-	-	-	-	-
Transfer to Stage 3	-	-	-	-	-
New financial assets originated	1 624 543	-	-	-	1 624 543
Changes in existing financial assets	(15 194)	-	-	-	(15 194)
Financial assets derecognised that are not write-offs	(3 780 079)	-	-	-	(3 780 079)
Write-offs	-	-	-	-	-
Other movements incl. FX differences	(44 662)	-	-	-	(44 662)
As at the end of the period	1 815 925	-	-	-	1 815 925

Loans and advances to banks measured at fair value through other comprehensive income 31.12.2025
Gross carrying amount	Stage 1	Stage 2	Stage 3	POCI	Total
As at the beginning of the period	-	-	-	-	-
Transfers
Transfer to Stage 1	-	-	-	-	-
Transfer to Stage 2	-	-	-	-	-
Transfer to Stage 3	-	-	-	-	-
New financial assets originated	556 022	-	-	-	556 022
Changes in existing financial assets	-	-	-	-	-
Financial assets derecognised that are not write-offs	-	-	-	-	-
Write-offs	-	-	-	-	-
Other movements incl. FX differences	-	-	-	-	-
As at the end of the period	556 022	-	-	-	556 022

*Data restated following changes to the presentation of cash and cash equivalents; details are presented in Note 2.5.

Loans and advances to banks 31.12.2024* restated
Gross carrying amount	Stage 1	Stage 2	Stage 3	POCI	Total
As at the beginning of the period	263 222	-	-	-	263 222
Transfers
Transfer to Stage 1	-	-	-	-	-
Transfer to Stage 2	-	-	-	-	-
Transfer to Stage 3	-	-	-	-	-
New financial assets originated	3 990 805	-	-	-	3 990 805
Changes in existing financial assets	(67 462)	-	-	-	(67 462)
Financial assets derecognised that are not write-offs	(143 549)	-	-	-	(143 549)
Write-offs	-	-	-	-	-
Other movements incl. FX differences	(11 699)	-	-	-	(11 699)
As at the end of the period	4 031 317	-	-	-	4 031 317

*Data restated following changes to the presentation of cash and cash equivalents; details are presented in Note 2.5.

20. Financial assets and liabilities held for trading

	31.12.2025		31.12.2024
Financial assets and liabilities held for trading	Assets	Liabilities	Assets	Liabilities
Trading derivatives	10 974 639	11 182 945	7 720 642	8 205 923
Interest rate operations	8 567 071	8 502 690	5 116 227	5 220 492
Forward	28	-	62	-
Options	40 557	40 961	95 715	96 065
IRS	8 352 287	8 300 360	4 811 051	4 938 686
FRA	174 199	161 369	209 399	185 741
FX operations	2 407 568	2 680 255	2 604 415	2 985 431
CIRS	877 256	1 111 278	675 305	1 001 811
Forward	237 211	197 678	254 083	270 288
FX Swap	1 183 317	1 261 832	1 575 868	1 614 354
Spot	1 426	1 019	1 145	668
Options	108 358	108 448	98 014	98 310
Debt and equity securities	4 303 972	-	1 626 933	-
Debt securities	3 994 706	-	1 506 602	-
Government securities:	3 978 470	-	1 490 857	-
- bills	311 948	-	-	-
- bonds	3 666 522	-	1 490 857	-
Commercial securities:	16 236	-	15 745	-
- bonds	16 236	-	15 745	-
Equity securities:	309 266	-	120 331	-
- listed	309 266	-	120 331	-
Short sale	-	1 180 478	-	1 703 764
Total	15 278 611	12 363 423	9 347 575	9 909 687

Financial assets and liabilities held for trading - trading derivatives include the change in the value of counterparty risk in the amount of PLN (390) k as at 31.12.2025 and PLN (874) k as at 31.12.2024.

The table below presents derivatives’ nominal values.

Derivatives’ nominal values	31.12.2025	31.12.2024
Term derivatives (hedging)	62 065 153	65 210 283
Single-currency interest rate swap (IRS)	3 305 529	6 333 554
Macro cash flow hedge -purchased (IRS)	55 202 239	53 945 900
Macro cash flow hedge -purchased (CIRS)	1 714 300	2 162 613
Macro cash flow hedge -sold (CIRS)	1 843 085	2 580 019
FX Swap cash flow hedge -purchased (FX)	-	97 456
FX Swap cash flow hedge-sold (FX)	-	90 741
Term derivatives (trading)	1 756 510 291	1 625 771 892
Interest rate operations	1 327 290 056	1 088 415 721
-Single-currency interest rate swap	1 029 550 545	820 624 993
-FRA - purchased amounts	292 124 500	260 551 000
-Options	5 536 697	7 125 228
-Forward- purchased amounts	53 150	-
-Forward- sold amounts	25 164	114 500
FX operations	429 220 235	537 356 171
-FX swap – purchased amounts	147 128 707	194 155 974
-FX swap – sold amounts	147 221 752	194 260 627
-Forward- purchased amounts	19 205 218	22 407 221
-Forward- sold amounts	19 166 113	22 348 963
-Cross-currency interest rate swap (CIRS) – purchased amounts	40 496 805	40 893 547
-Cross-currency interest rate swap (CIRS) – sold amounts	40 733 057	41 178 953
-FX options -purchased CALL	3 775 807	5 314 983
-FX options -purchased PUT	3 858 472	5 740 460
-FX options -sold CALL	3 775 822	5 314 983
-FX options -sold PUT	3 858 482	5 740 460
Currency transactions- spot	2 910 222	2 836 446
Spot-purchased	1 455 289	1 418 317
Spot-sold	1 454 933	1 418 129
Transactions on equity financial instruments	313 460	123 222
Derivatives contract - purchased	313 098	122 469
Derivatives contract - sold	362	753
Total	1 821 799 126	1 693 941 843

In the case of single-currency transactions (IRS, FRA, non-FX options) only purchased amounts are presented.

21. Hedging derivatives

	31.12.2025		31.12.2024
Hedging derivatives	Assets	Liabilities	Assets	Liabilities
Derivatives hedging fair value	61 758	31 738	173 150	95 108
Derivatives hedging cash flow	1 961 969	161 137	1 228 603	512 629
Total	2 023 727	192 875	1 401 753	607 737

As at 31.12.2025, the line item: hedging derivatives – derivatives hedging cash flows reflects a change in the first-day valuation of forward-starting CIRS transactions of PLN (0) k and PLN (114) k as at 31.12.2024.

22. Loans and advances to customers

	31.12.2025
Loans and advances to customers	measured at amortised cost	measured at fair value through other comprehensive income	measured at fair value through profit or loss	from finance leases	Total
Loans and advances to enterprises	70 968 897	3 069 335	-	-	74 038 232
Loans and advances to individuals, of which:	79 743 677	-	-	-	79 743 677
Home mortgage loans*	56 716 404	-	-	-	56 716 404
Finance lease receivables	-	-	-	10 989 482	10 989 482
Loans and advances to public sector	1 892 613	249 526	-	-	2 142 139
Other receivables	60 939	188	-	-	61 127
Gross receivables	152 666 126	3 319 049	-	10 989 482	166 974 657
Allowance for impairment	(3 761 631)	(151 665)	-	(223 637)	(4 136 933)
Total	148 904 495	3 167 384	-	10 765 845	162 837 724

* Includes changes in gross book value described in note 47 Legal risk connected with CHF mortgage loans

	31.12.2024
Loans and advances to customers	measured at amortised cost	measured at fair value through other comprehensive income	measured at fair value through profit or loss	from finance leases	Total
Loans and advances to enterprises	69 736 432	4 140 166	-	-	73 876 598
Loans and advances to individuals, of which:	88 750 902	-	63 289	-	88 814 191
Home mortgage loans*	55 931 181	-	-	-	55 931 181
Finance lease receivables	-	-	-	15 145 171	15 145 171
Loans and advances to public sector	2 189 540	249 725	-	-	2 439 265
Other receivables	70 216	123	-	-	70 339
Gross receivables	160 747 090	4 390 014	63 289	15 145 171	180 345 564
Allowance for impairment	(5 152 221)	(100 018)	-	(317 044)	(5 569 283)
Total	155 594 869	4 289 996	63 289	14 828 127	174 776 281

* Includes changes in gross book value described in note 47 Legal risk connected with CHF mortgage loans

Impact of the legal risk of mortgage loans in foreign currency	Gross carrying amount of mortgage loans in foreign currency before adjustment due to legal risk costs	Impact of the legal risk of mortgage loans in foreign currency	Gross carrying amount of mortgage loans in foreign currency after adjustment due to legal risk costs*
31.12.2025
Mortgage loans in foreign currency - adjustment to gross carrying amount	2 641 967	2 571 589**	70 378
Provision in respect of legal risk connected with foreign currency mortgage loans		2 194 704
Total		4 766 293
31.12.2024
Mortgage loans in foreign currency - adjustment to gross carrying amount	5 173 697	4 676 771	496 926
Provision in respect of legal risk connected with foreign currency mortgage loans		1 915 242
Total		6 592 013

* Includes changes in gross book value described in note 47 Legal risk connected with CHF mortgage loans

**of which the amount of PLN 2,350,380 k refers to loans denominated in and indexed to CHF, and the amount of PLN 221,209 k converted into PLN loans subject to debt enforcement

The Santander Bank Polska Group may write-off financial assets that are still subject to enforcement activity. The outstanding contractual amount of such assets written off during the year ended 31 December 2025 was PLN 138,091 k PLN and PLN 424,158 k in 2024.

Lease receivables are presented in note 51. Fair value of loans and advances to customers is presented in note 46.

Loans and advances to customers 31.12.2025
Gross carrying amount	Stage 1	Stage 2	Stage 3	POCI	Total
As at the beginning of the period	137 206 606	16 402 482	6 544 382	593 620	160 747 090
Transfers
Transfer to Stage 1	16 796 149	(16 743 776)	(52 373)	-	-
Transfer to Stage 2	(22 754 402)	22 990 652	(236 250)	-	-
Transfer to Stage 3	(136 713)	(1 690 600)	1 827 313	-	-
New financial assets originated	30 664 448	-	-	-	30 664 448
Changes in existing financial assets	(1 542 252)	(1 909 652)	(894 903)	138 419	(4 208 388)
Financial assets derecognised that are not write-offs	(16 820 260)	(1 642 251)	(491 317)	(51 702)	(19 005 530)
Write-offs	-	-	(491 031)	-	(491 031)
FX and others movements	(425 478)	(26 432)	(16 193)	6 403	(461 700)
Change due to disposal of discontinued operations	(12 346 762)	(1 054 600)	(1 126 354)	(51 047)	(14 578 763)
As at the end of the period	130 641 336	16 325 823	5 063 274	635 693	152 666 126

Movements on allowances for expected credit losses on loans and advances to customers measured at amortised cost for reporting period 1.01.2025 - 31.12.2025	Stage 1	Stage 2	Stage 3	Total
As at the beginning of the period	(512 185)	(929 127)	(3 586 803)	(5 028 115)
Transfers
Transfer to Stage 1	(687 216)	703 658	16 000	32 442
Transfer to Stage 2	227 861	(351 938)	81 781	(42 296)
Transfer to Stage 3	1 640	269 863	(282 872)	(11 369)
New financial assets originated	(118 856)	-	-	(118 856)
Changes in credit risk of existing financial assets	564 323	(738 412)	(394 769)	(568 858)
Changes in models and risk parameters	4 189	(2 060)	-	2 129
Financial assets derecognised that are not write-offs	63 472	80 043	161 996	305 511
Write-offs	-	-	491 031	491 031
FX and others movements	(5 835)	(2 743)	4 016	(4 562)
Change due to disposal of discontinued operations	196 867	148 566	935 784	1 281 217
As at the end of the period	(265 740)	(822 150)	(2 573 836)	(3 661 726)

Reconciliation to note 12: Impairment allowances for expected credit losses measured at amortised cost	Stage 1	Stage 2	Stage 3	Total
Movements on allowances for expected credit losses on loans and advances to customers measured at amortised cost for reporting period 1.01.2025- 31.12.2025	49 579	(41 589)	77 183	85 173
Movements on allowances for expected credit losses on finance lease receivables measured at amortised cost for reporting period 1.01.2025 - 31.12.2025	1 970	4 391	(11 580)	(5 219)
Transfers that do not go through profit and loss	(80 707)	(185 475)	111 316	(154 866)
Write-offs	-	-	(525 960)	(525 960)
Impairment allowances for expected credit losses on loans measured at fair value through other comprehensive income	(34)	(16 057)	(39 603)	(55 694)
FX differences	(838)	(1 220)	(4 234)	(6 292)
Total	(30 030)	(239 950)	(392 878)	(662 858)

Movements on impairment losses on purchased or originated credit-impaired loans (POCI)	1.01.2025-31.12.2025	1.01.2024-31.12.2024
As at the beginning of the period	(124 106)	(165 194)
Charge/write back of current period	(262)	34 780
Write off/Sale of receivables	-	773
F/X differences	72	292
Other	140	5 243
Change due to disposal of discontinued operations	24 251	-
As at the end of the period	(99 905)	(124 106)

Loans and advances to customers 31.12.2024
Gross carrying amount	Stage 1	Stage 2	Stage 3	POCI	Total
As at the beginning of the period	133 703 229	8 105 702	6 202 074	806 824	148 817 829
Transfers
Transfer to Stage 1	11 643 861	(11 462 332)	(181 529)	-	-
Transfer to Stage 2	(24 176 922)	24 464 281	(287 359)	-	-
Transfer to Stage 3	(598 360)	(2 764 114)	3 362 474	-	-
New financial assets originated	31 698 738	-	-	-	31 698 738
Changes in existing financial assets	2 351 512	(1 060 191)	(836 275)	4 927	459 973
Financial assets derecognised that are not write-offs	(16 919 617)	(1 000 231)	(523 117)	(210 874)	(18 653 839)
Write-offs	-	-	(1 100 996)	-	(1 100 996)
FX and others movements	(495 835)	119 367	(90 890)	(7 257)	(474 615)
As at the end of the period	137 206 606	16 402 482	6 544 382	593 620	160 747 090

Movements on allowances for expected credit losses on loans and advances to customers measured at amortised cost for reporting period 1.01.2024 - 31.12.2024	Stage 1	Stage 2	Stage 3	Total
As at the beginning of the period	(640 339)	(728 294)	(3 795 998)	(5 164 631)
Transfers
Transfer to Stage 1	(746 222)	716 708	79 827	50 313
Transfer to Stage 2	419 228	(600 451)	113 828	(67 395)
Transfer to Stage 3	51 387	398 951	(710 854)	(260 516)
New financial assets originated	(347 371)	-	-	(347 371)
Changes in credit risk of existing financial assets	625 252	(814 604)	(576 183)	(765 535)
Changes in models and risk parameters	12 519	38 290	37 260	88 069
Financial assets derecognised that are not write-offs	103 743	65 070	158 901	327 714
Write-offs	-	-	1 100 955	1 100 955
FX and others movements	9 618	(4 797)	5 461	10 282
As at the end of the period	(512 185)	(929 127)	(3 586 803)	(5 028 115)

Reconciliation to note 12: Impairment allowances for expected credit losses measured at amortised cost	Stage 1	Stage 2	Stage 3	Total
Movements on allowances for expected credit losses on loans and advances to customers measured at amortised cost for reporting period 1.01.2024 - 31.12.2024	128 155	(200 834)	209 194	136 515
Movements on allowances for expected credit losses on finance lease receivables measured at amortised cost for reporting period 1.01.2024 - 31.12.2024	3 239	(25 925)	(24 297)	(46 983)
Transfers that do not go through profit and loss	(153 340)	(345 225)	345 840	(152 725)
Write-offs	-	-	(1 100 955)	(1 100 955)
Impairment allowances for expected credit losses on loans measured at fair value through other comprehensive income	106	2 099	(6 765)	(4 560)
FX differences	(596)	(1 958)	(4 194)	(6 748)
Change due to disposal of discontinued operations	25 400	197 118	75 487	298 005
Total	2 964	(374 725)	(505 690)	(877 451)

Loans and advances to enterprises 31.12.2025
Gross carrying amount	Stage 1	Stage 2	Stage 3	POCI	Total
As at the beginning of the period	60 324 832	5 877 532	3 231 882	302 186	69 736 432
Transfers
Transfer to Stage 1	5 470 591	(5 456 475)	(14 116)	-	-
Transfer to Stage 2	(8 359 940)	8 385 628	(25 688)	-	-
Transfer to Stage 3	(81 810)	(729 584)	811 394	-	-
New financial assets originated	13 694 125	-	-	-	13 694 125
Changes in existing financial assets	578 042	(1 008 589)	(790 966)	143 739	(1 077 774)
Financial assets derecognised that are not write-offs	(7 883 716)	(856 145)	(146 827)	(20 248)	(8 906 936)
Write-offs	-	-	(271 919)	-	(271 919)
FX and others movements	(413 603)	(25 235)	(8 623)	(855)	(448 316)
Change due to disposal of discontinued operations	(1 747 541)	(126 397)	108 818	8 405	(1 756 715)
As at the end of the period	61 580 980	6 060 735	2 893 955	433 227	70 968 897

Movements on allowances for expected credit losses on loans and advances to enterprises measured at amortised cost for reporting period 1.01.2025 - 31.12.2025	Stage 1	Stage 2	Stage 3	Total
As at the beginning of the period	(180 329)	(398 840)	(1 634 987)	(2 214 156)
Transfers
Transfer to Stage 1	(258 260)	285 369	5 165	32 274
Transfer to Stage 2	84 579	(139 394)	12 530	(42 285)
Transfer to Stage 3	1 198	97 313	(109 276)	(10 765)
New financial assets originated	(42 899)	-	-	(42 899)
Changes in credit risk of existing financial assets	191 323	(262 064)	(59 601)	(130 342)
Changes in models and risk parameters	3 025	(710)	-	2 315
Financial assets derecognised that are not write-offs	26 829	43 927	21 001	91 757
Write-offs	-	-	271 919	271 919
FX and others movements	(5 835)	(2 757)	3 979	(4 613)
Change due to disposal of discontinued operations	18 814	20 343	8 639	47 796
As at the end of the period	(161 555)	(356 813)	(1 480 631)	(1 998 999)

Movements on impairment losses on purchased or originated credit-impaired loans and advances to enterprises (POCI)	1.01.2025-31.12.2025	1.01.2024-31.12.2024
As at the beginning of the period	(50 706)	(65 741)
Charge/write back of current period	(7 978)	14 307
Write off/Sale of receivables	-	163
F/X differences	71	142
Other	134	423
Change due to disposal of discontinued operations	51	-
As at the end of the period	(58 428)	(50 706)

Loans and advances to enterprises 31.12.2024
Gross carrying amount	Stage 1	Stage 2	Stage 3	POCI	Total
As at the beginning of the period	57 079 240	4 718 775	2 564 927	439 554	64 802 496
Transfers
Transfer to Stage 1	4 421 431	(4 323 478)	(97 953)	-	-
Transfer to Stage 2	(8 108 279)	8 179 900	(71 621)	-	-
Transfer to Stage 3	(261 930)	(1 564 169)	1 826 099	-	-
New financial assets originated	9 928 482	-	-	-	9 928 482
Changes in existing financial assets	4 351 218	(596 859)	(565 906)	26 437	3 214 890
Financial assets derecognised that are not write-offs	(6 613 030)	(493 080)	(44 391)	(161 796)	(7 312 297)
Write-offs	-	-	(444 290)	-	(444 290)
FX and others movements	(472 300)	(43 557)	65 017	(2 009)	(452 849)
As at the end of the period	60 324 832	5 877 532	3 231 882	302 186	69 736 432

Movements on allowances for expected credit losses on loans and advances to enterprises measured at amortised cost for reporting period 1.01.2024 - 31.12.2024	Stage 1	Stage 2	Stage 3	Total
As at the beginning of the period	(225 428)	(343 238)	(1 693 314)	(2 261 980)
Transfers
Transfer to Stage 1	(338 290)	311 800	53 833	27 343
Transfer to Stage 2	118 583	(182 304)	26 078	(37 643)
Transfer to Stage 3	3 778	156 393	(196 061)	(35 890)
New financial assets originated	(53 380)	-	-	(53 380)
Changes in credit risk of existing financial assets	285 167	(356 903)	(236 359)	(308 095)
Changes in models and risk parameters	2 169	(3 330)	22 070	20 909
Financial assets derecognised that are not write-offs	19 458	23 046	(53 981)	(11 477)
Write-offs	-	-	444 249	444 249
FX and others movements	7 614	(4 304)	(1 502)	1 808
As at the end of the period	(180 329)	(398 840)	(1 634 987)	(2 214 156)

Loans and advances to individuals - home mortgage loans 31.12.2025
Gross carrying amount	Stage 1	Stage 2	Stage 3	POCI	Total
As at the beginning of the period	48 533 198	6 379 941	848 600	169 442	55 931 181
Transfers
Transfer to Stage 1	5 816 781	(5 790 724)	(26 057)	-	-
Transfer to Stage 2	(5 666 918)	5 768 652	(101 734)	-	-
Transfer to Stage 3	(22 789)	(233 302)	256 091	-	-
New financial assets originated	4 769 420	-	-	-	4 769 420
Changes in existing financial assets	1 706 968	(178 394)	(32 018)	(18 078)	1 478 478
Financial assets derecognised that are not write-offs	(3 587 466)	(348 564)	(101 763)	(11 914)	(4 049 707)
Write-offs	-	-	(22 405)	-	(22 405)
FX and others movements	(8 743)	(1 099)	(420)	(215)	(10 477)
Change due to disposal of discontinued operations	(1 229 062)	(67 925)	(58 443)	(24 656)	(1 380 086)
As at the end of the period	50 311 389	5 528 585	761 851	114 579	56 716 404

Movements on allowances for expected credit losses on loans and advances to individuals for home mortgage loans measured at amortised cost for reporting period 1.01.2025 - 31.12.2025	Stage 1	Stage 2	Stage 3	Total
As at the beginning of the period	(23 138)	(84 467)	(308 623)	(416 228)
Transfers
Transfer to Stage 1	(68 138)	61 721	6 417	-
Transfer to Stage 2	5 831	(30 520)	24 689	-
Transfer to Stage 3	26	17 379	(17 405)	-
New financial assets originated	(1 148)	-	-	(1 148)
Changes in credit risk of existing financial assets	63 696	(29 170)	(67 328)	(32 802)
Changes in models and risk parameters	80	(550)	-	(470)
Financial assets derecognised that are not write-offs	825	3 986	32 770	37 581
Write-offs	-	-	13 268	13 268
FX and others movements	29	192	(5 497)	(5 276)
Change due to disposal of discontinued operations	14 683	5 353	40 942	60 978
As at the end of the period	(7 254)	(56 076)	(280 767)	(344 097)

Movements on impairment losses on purchased or originated credit-impaired loans and advances to individuals for home mortgage loans (POCI)	1.01.2025-31.12.2025	1.01.2024-31.12.2024
As at the beginning of the period	(27 696)	(36 596)
Charge/write back of current period	6 034	8 724
FX differences	1	150
Other	1	26
Change due to disposal of discontinued operations	4 746	-
As at the end of the period	(16 914)	(27 696)

Loans and advances to individuals - home mortgage loans 31.12.2024
Gross carrying amount	Stage 1	Stage 2	Stage 3	POCI	Total
As at the beginning of the period	50 337 487	1 460 415	1 006 092	210 149	53 014 143
Transfers
Transfer to Stage 1	3 558 614	(3 513 634)	(44 980)	-	-
Transfer to Stage 2	(8 938 886)	9 052 514	(113 628)	-	-
Transfer to Stage 3	(53 332)	(267 322)	320 654	-	-
New financial assets originated	4 287 901	-	-	-	4 287 901
Changes in existing financial assets	2 119 521	(163 999)	(145 568)	(21 834)	1 788 120
Financial assets derecognised that are not write-offs	(2 710 333)	(188 168)	(131 496)	(18 241)	(3 048 238)
Write-offs	-	-	(16 819)	-	(16 819)
FX and others movements	(67 774)	135	(25 655)	(632)	(93 926)
As at the end of the period	48 533 198	6 379 941	848 600	169 442	55 931 181

Movements on allowances for expected credit losses on loans and advances to individuals for home mortgage loans measured at amortised cost for reporting period 1.01.2024 - 31.12.2024	Stage 1	Stage 2	Stage 3	Total
As at the beginning of the period	(46 357)	(42 915)	(418 976)	(508 248)
Transfers
Transfer to Stage 1	(74 022)	64 363	5 979	(3 680)
Transfer to Stage 2	27 263	(54 776)	28 756	1 243
Transfer to Stage 3	265	28 728	(27 201)	1 792
New financial assets originated	(10 405)	-	-	(10 405)
Changes in credit risk of existing financial assets	73 922	(103 783)	13 834	(16 027)
Changes in models and risk parameters	2 070	20 180	15 190	37 440
Financial assets derecognised that are not write-offs	2 703	4 062	56 092	62 857
Write-offs	-	-	16 819	16 819
FX and others movements	1 423	(326)	884	1 981
As at the end of the period	(23 138)	(84 467)	(308 623)	(416 228)

Loans and advances to individuals - other loans 31.12.2025
Gross carrying amount	Stage 1	Stage 2	Stage 3	POCI	Total
As at the beginning of the period	26 392 892	3 972 794	2 324 896	129 139	32 819 721
Transfers
Transfer to Stage 1	5 508 777	(5 496 577)	(12 200)	-	-
Transfer to Stage 2	(8 727 544)	8 836 372	(108 828)	-	-
Transfer to Stage 3	(32 114)	(727 714)	759 828	-	-
New financial assets originated	12 332 779	-	-	-	12 332 779
Changes in existing financial assets	(3 827 262)	(549 334)	(80 263)	20 123	(4 436 736)
Financial assets derecognised that are not write-offs	(5 349 078)	(437 542)	(242 726)	(19 430)	(6 048 776)
Write-offs	-	-	(196 707)	-	(196 707)
FX and others movements	(891)	(98)	(53)	(2)	(1 044)
Change due to disposal of discontinued operations	(9 370 160)	(860 278)	(1 176 729)	(34 797)	(11 441 964)
As at the end of the period	16 927 399	4 737 623	1 267 218	95 033	23 027 273

Movements on allowances for expected credit losses on loans and advances to individuals for other loans measured at amortised cost for reporting period 1.01.2025 - 31.12.2025	Stage 1	Stage 2	Stage 3	Total
As at the beginning of the period	(308 716)	(445 819)	(1 643 195)	(2 397 730)
Transfers
Transfer to Stage 1	(360 818)	356 568	4 417	167
Transfer to Stage 2	137 451	(182 024)	44 561	(12)
Transfer to Stage 3	416	155 171	(156 190)	(603)
New financial assets originated	(74 809)	-	-	(74 809)
Changes in credit risk of existing financial assets	309 304	(447 177)	(267 840)	(405 713)
Changes in models and risk parameters	1 084	(800)	-	284
Financial assets derecognised that are not write-offs	35 817	32 129	108 225	176 171
Write-offs	-	-	205 844	205 844
FX and others movements	(29)	(179)	5 534	5 326
Change due to disposal of discontinued operations	163 370	122 870	886 203	1 172 443
As at the end of the period	(96 930)	(409 261)	(812 441)	(1 318 632)

Movements on impairment losses on purchased or originated credit-impaired loans and advances to individuals for other loans (POCI)	1.01.2025-31.12.2025	1.01.2024-31.12.2024
As at the beginning of the period	(45 703)	(62 855)
Charge/write back of current period	1 683	11 744
Write off/Sale of receivables	-	610
Other	6	4 798
Change due to disposal of discontinued operations	19 457	-
As at the end of the period	(24 557)	(45 703)

Loans and advances to individuals - other loans 31.12.2024
Gross carrying amount	Stage 1	Stage 2	Stage 3	POCI	Total
As at the beginning of the period	25 249 657	1 919 742	2 627 028	156 808	29 953 235
Transfers
Transfer to Stage 1	3 663 816	(3 625 220)	(38 596)	-	-
Transfer to Stage 2	(7 129 757)	7 231 867	(102 110)	-	-
Transfer to Stage 3	(283 098)	(932 623)	1 215 721	-	-
New financial assets originated	16 443 299	-	-	-	16 443 299
Changes in existing financial assets	(4 119 226)	(468 473)	(127 281)	70	(4 714 910)
Financial assets derecognised that are not write-offs	(7 596 254)	(318 983)	(347 230)	(30 615)	(8 293 082)
Write-offs	-	-	(639 887)	-	(639 887)
FX and others movements	164 455	166 484	(262 749)	2 876	71 066
As at the end of the period	26 392 892	3 972 794	2 324 896	129 139	32 819 721

Movements on allowances for expected credit losses on loans and advances to individuals for other loans measured at amortised cost for reporting period 1.01.2024 - 31.12.2024	Stage 1	Stage 2	Stage 3	Total
As at the beginning of the period	(368 554)	(342 141)	(1 683 708)	(2 394 403)
Transfers
Transfer to Stage 1	(333 909)	340 545	20 015	26 651
Transfer to Stage 2	273 382	(363 371)	58 994	(30 995)
Transfer to Stage 3	47 345	213 830	(487 593)	(226 418)
New financial assets originated	(283 586)	-	-	(283 586)
Changes in credit risk of existing financial assets	266 163	(353 917)	(353 658)	(441 412)
Changes in models and risk parameters	8 280	21 440	-	29 720
Financial assets derecognised that are not write-offs	81 582	37 961	156 790	276 333
Write-offs	-	-	639 887	639 887
FX and others movements	581	(166)	6 078	6 493
As at the end of the period	(308 716)	(445 819)	(1 643 195)	(2 397 730)

Finance lease receivables 31.12.2025
Gross carrying amount	Stage 1	Stage 2	Stage 3	POCI	Total
As at the beginning of the period	13 529 475	1 076 145	537 059	2 492	15 145 171
Transfers
Transfer to Stage 1	1 620 646	(1 602 308)	(18 338)	-	-
Transfer to Stage 2	(2 300 947)	2 313 280	(12 333)	-	-
Transfer to Stage 3	(4 886)	(190 396)	195 282	-	-
New financial assets originated	2 990 337	-	-	-	2 990 337
Changes in existing financial assets	(1 757 924)	(328 196)	(98 790)	(690)	(2 185 600)
Financial assets derecognised that are not write-offs	(521 364)	(75 418)	(29 036)	(74)	(625 892)
Write-offs	-	-	(35 288)	(277)	(35 565)
FX and others movements	922	122	21	-	1 065
Change due to disposal of discontinued operations	(4 073 300)	(100 843)	(125 057)	(834)	(4 300 034)
As at the end of the period	9 482 959	1 092 386	413 520	617	10 989 482

Movements on allowances for expected credit losses on finance lease receivables measured at amortised cost for reporting period 1.01.2025 - 31.12.2025	Stage 1	Stage 2	Stage 3	Total
As at the beginning of the period	(36 175)	(75 277)	(205 592)	(317 044)
Transfers
Transfer to Stage 1	(11 533)	56 891	2 199	47 557
Transfer to Stage 2	19 461	(83 611)	1 647	(62 503)
Transfer to Stage 3	45	16 320	(32 505)	(16 140)
New financial assets originated	(14 399)	-	-	(14 399)
Changes in credit risk of existing financial assets	4 419	8 820	(24 049)	(10 810)
Changes in models and risk parameters	2 883	3 825	-	6 708
Financial assets derecognised that are not write-offs	1 093	2 146	8 471	11 710
Write-offs	-	-	34 929	34 929
FX and others movements	-	-	(2 272)	(2 272)
Change due to disposal of discontinued operations	8 329	30 342	59 956	98 627
As at the end of the period	(25 877)	(40 544)	(157 216)	(223 637)

Finance lease receivables 31.12.2024
Gross carrying amount	Stage 1	Stage 2	Stage 3	POCI	Total
As at the beginning of the period	12 339 025	604 648	471 925	3 140	13 418 738
Transfers
Transfer to Stage 1	1 289 008	(1 260 534)	(28 474)	-	-
Transfer to Stage 2	(2 296 268)	2 305 930	(9 662)	-	-
Transfer to Stage 3	(28 288)	(241 966)	270 254	-	-
New financial assets originated	5 390 535	-	-	-	5 390 535
Changes in existing financial assets	(2 345 544)	(294 002)	(120 835)	(653)	(2 761 034)
Financial assets derecognised that are not write-offs	(737 130)	(38 303)	(35 607)	5	(811 035)
Write-offs	-	-	(46 092)	-	(46 092)
FX and others movements	(81 863)	372	35 550	-	(45 941)
As at the end of the period	13 529 475	1 076 145	537 059	2 492	15 145 171

Movements on allowances for expected credit losses on finance lease receivables measured at amortised cost for reporting period 1.01.2024 - 31.12.2024	Stage 1	Stage 2	Stage 3	Total
As at the beginning of the period	(39 414)	(49 352)	(181 296)	(270 062)
Transfers
Transfer to Stage 1	(18 065)	63 766	2 919	48 620
Transfer to Stage 2	30 011	(100 688)	1 614	(69 063)
Transfer to Stage 3	212	22 262	(44 403)	(21 929)
New financial assets originated	(23 060)	-	-	(23 060)
Changes in credit risk of existing financial assets	11 164	(12 502)	(45 185)	(46 523)
Changes in models and risk parameters	-	-	-	-
Financial assets derecognised that are not write-offs	1 760	1 748	21 911	25 419
Write-offs	-	-	45 414	45 414
FX and others movements	1 217	(511)	(6 566)	(5 860)
As at the end of the period	(36 175)	(75 277)	(205 592)	(317 044)

23. Securitisation of assets

The purpose of synthetic securitization transactions conducted by Santander Bank Polska and its subsidiaries is to implement the Tier 1 capital optimization strategy of the Bank and the Santander Bank Polska S.A. Capital Group. by enabling the calculation of securitized exposure amounts in accordance with the relevant provisions of Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No 648/2021, as amended ("CRR Regulation").

The released capital is further intended, among others, to finance pro-ecological and climate projects (related to the mitigation of climate change, focusing on renewable energy sources, energy efficiency) and projects supporting the development of the SME, corporate and public sector customer segments.

The transactions carried out by the Bank and entities of the Santander Bank Polska Capital Group are synthetic securitizations without a financing element, and the selected loan portfolios covered by them remain on the balance sheet. In the light of the provisions of IFRS 9, the contractual terms of the securitization transactions do not meet the grounds for not including the securitized assets in the statement of financial position.

Santander Bank Polska S.A.

On June 26, 2025, Santander Bank Polska S.A. executed a synthetic securitisation transaction on a portfolio of corporate exposures with a total nominal value of PLN 4,182,547k. The securitised portfolio was divided into three tranches determining the order of allocation of credit losses: senior (91.5% of the portfolio), mezzanine (7.65% of the portfolio) and the first-loss tranche (0.85% of the portfolio).

The junior and senior tranches were retained by the Bank, while the mezzanine tranche was fully subscribed by external investors not related to the Bank. The transfer of risk of the securitised portfolio was achieved through an eligible credit protection instrument in the form of a funded credit-linked note (CLN). The CLN provides coverage of losses on the securitised portfolio up to the amount of the mezzanine tranche. The requirement to maintain a material net economic interest is fulfilled through the retention of randomly selected eligible exposures representing at least 5% of the nominal value of the securitised loans. The agreement provides for a one-year replenishment period during which the Bank may replenish the transaction structure for the value of the amortised portfolio.

As part of the transaction, on 26 June 2025 Santander Bank Polska S.A. issued CLN notes with a nominal value of PLN 320,000 k, with a maturity date of 31 March 2036. The Bank holds an option for early redemption of obligations arising from the CLN notes. The CLN notes, identified by ISIN XS3097964541, were admitted to trading on the Vienna MTF, an alternative trading system operated by Wiener Börse AG (Vienna Stock Exchange).

As at December 31, 2025, the amount of the portfolio subject to securitization amounted to PLN 4,182,545k. The values of individual tranches were as follows: senior tranche PLN 3,826,996 k, mezzanine tranche 320,000 k and junior tranche PLN 35,552 k

On December 9, 2025, Santander Bank Polska S.A. executed a synthetic securitisation transaction on a portfolio of unsecured consumer loans granted to individuals, with a total nominal value of PLN 3,961,191 k.

The securitised receivables portfolio was divided into three tranches: the senior tranche (89.5% of the portfolio), the mezzanine tranche (9.3% of the portfolio) and the junior tranche, constituting the first-loss tranche (1.2% of the portfolio). The junior and senior tranches were retained by the Bank. The mezzanine tranche was fully subscribed by external investors not related to the Bank.

To ensure the stability of the portfolio structure, the transaction includes a Synthetic Excess Spread (SES) mechanism, allowing losses on the portfolio to be allocated outside the tranche structure up to 0.35% of the portfolio per annum, with this mechanism being renewable after one year.

As part of the transaction, on 9 December 2025 Santander Bank Polska S.A. issued CLN Notes identified by ISIN XS3237111789, with a maturity date of 30 September 2034 and a nominal value of PLN 368,500k. The Bank holds an option for early redemption of obligations arising from the CLN Notes. The CLN Notes were admitted to trading on the Vienna MTF, an alternative trading system operated by Wiener Börse AG (Vienna Stock Exchange).

The requirement to maintain a material net economic interest is fulfilled through the retention of randomly selected eligible exposures representing at least 5% of the nominal value of the securitised loans. The agreement provides for a one‑year replenishment period during which the Bank may replenish the transaction structure for the value of the amortised portion of the portfolio.

As at 31 December 2025, the value of the securitised portfolio amounted to PLN 3,863,037 k. The tranche values were as follows: senior tranche – PLN 3,456,245 k, mezzanine tranche – PLN 359,258 k, and junior tranche – PLN 47,534k.

The transaction takes the form of a synthetic STS securitization with risk transfer within the meaning of Regulation (EU) No 2402/2017 of the European Parliament and of the Council on the establishment of a general framework for securitization and the creation of a specific framework for simple, transparent and standard securitizations. The subject of securitization were selected loan portfolios that remain on the Bank's balance sheet.

Risks related to securitization

Entities of the Santander Bank Polska Capital Group carried out securitization transactions in order to reduce the credit risk incurred and release part of the capital. The risks associated with securitization include, among others: risks that result from the role of the Bank and its subsidiaries as entities initiating and servicing the transaction (monitoring underlying transactions, reporting, debt collection). The Bank constantly analyzes risks that may materialize after concluding securitization transactions, as well as risks that may materialize in connection with the planned execution of subsequent securitization transactions.

24. Investment securities

Investment securities	31.12.2025	31.12.2024* restated	1.01.2024* restated
Debt investment securities measured at fair value through other comprehensive income	28 689 816	34 847 851	41 352 202
Government securities:	23 536 239	23 834 660	27 436 096
- bills	4 929 599	-	-
- bonds	18 606 640	23 834 660	27 436 096
Other securities:	5 153 577	11 013 191	13 916 106
-bonds	5 153 577	11 013 191	13 916 106
Debt investment securities measured at fair value through profit and loss	-	1 247	2 005
Debt investment securities measured at amortised cost	49 689 035	35 596 997	19 639 468
Government securities:	43 461 932	32 464 124	18 675 450
- bonds	43 461 932	32 464 124	18 675 450
Other securities:	6 227 103	3 132 873	964 018
- bonds	6 227 103	3 132 873	964 018
Equity investment securities measured at fair value through other comprehensive income	486 830	462 317	277 121
- unlisted	486 830	462 317	277 121
Equity investment securities measured at fair value through profit and loss	-	8 619	5 839
- unlisted	-	8 619	5 839
Total	78 865 681	70 917 031	61 276 635

*Data restated following changes to the presentation of cash and cash equivalents; details are presented in Note 2.5.

Movements on investment securities 1.01.2025 - 31.12.2025	Debt investment securities measured at fair value through other comprehensive income	Debt investment securities measured at fair value through profit and loss	Debt investment securities measured at amortised cost	Equity investment securities measured at fair value through other comprehensive income	Equity investment securities measured at fair value through profit and loss	Total
As at the beginning of the period	34 847 851	1 247	35 596 997	462 317	8 619	70 917 031
Additions	8 663 550	-	21 732 592	-	388	30 396 530
Disposals (sale and maturity)	(12 815 714)	-	(5 611 306)	-	(368)	(18 427 388)
Fair value adjustment	692 112	-	-	24 513	-	716 625
Movements on interest accrued	69 908	-	392 639	-	-	462 547
FX differences	(75 093)	-	(52 649)	-	(20)	(127 762)
Change due to the sale of discontinued operations	(2 692 798)	(1 247)	(2 369 238)	-	(8 619)	(5 071 902)
As at the end of the period	28 689 816	-	49 689 035	486 830	-	78 865 681

Movements on investment securities * 1.01.2024 - 31.12.2024	Debt investment securities measured at fair value through other comprehensive income	Debt investment securities measured at fair value through profit and loss	Debt investment securities measured at amortised cost	Equity investment securities measured at fair value through other comprehensive income	Equity investment securities measured at fair value through profit and loss	Total
As at the beginning of the period	41 352 202	2 005	19 639 468	277 121	5 839	61 276 635
Additions	3 060 951	-	25 644 879	1 582	500	28 707 912
Disposals (sale and maturity)	(10 075 257)	-	(10 160 975)	(2 531)	(500)	(20 239 263)
Fair value adjustment	538 630	(810)	-	186 145	1 462	725 427
Movements on interest accrued	(21 975)	-	529 973	-	-	507 998
FX differences	(6 700)	52	(56 348)	-	1 318	(61 678)
As at the end of the period	34 847 851	1 247	35 596 997	462 317	8 619	70 917 031

*Data restated following changes to the presentation of cash and cash equivalents; details are presented in Note 2.5.

25. Investments in associates

Balance sheet value of associates	31.12.2025	31.12.2024
Polfund - Fundusz Poręczeń Kredytowych S.A.	52 494	50 074
Santander - Allianz Towarzystwo Ubezpieczeń S.A. and Santander - Allianz Towarzystwo Ubezpieczeń na Życie S.A.	938 244	917 135
Total	990 738	967 209

Movements on investments in associates	1.01.2025-31.12.2025	1.01.2024-31.12.2024
As at the beginning of the period	967 209	967 514
Share of profits/(losses)	114 457	102 297
Dividends	(98 113)	(108 559)
Other	7 185	5 957
As at the end of the period	990 738	967 209

The table below presents information regarding the Group’s share in capital of associate:

Name of associate	Country of incorporation and place of business	The Group’s share in capital / voting power		Valuation method	Scope of business
		2025	2024
Santander - Allianz Towarzystwo Ubezpieczeń na Życie S.A.	Poland Warszawa	49,00	49,00	Equity method	insurance activity, life insurance
Santander - Allianz Towarzystwo Ubezpieczeń S.A.	Poland Warszawa	49,00	49,00	Equity method	insurance activity, property and personal insurance
POLFUND - Fundusz Poręczeń Kredytowych S.A.	Poland Szczecin	50,00	50,00	Equity method	providing lending guarantees, investing and managing funds invested in companies

The table below presents condensed financial information regarding associates which have a significant contribution to the Group:

	Santander - Allianz Towarzystwo Ubezpieczeń na Życie S.A.		Santander - Allianz Towarzystwo Ubezpieczeń S.A.
	2025	2024	2025	2024
Loans and advances to banks	16 921	48 432	9 268	1 893
Financial assets held for trading	1 459	3 837	-	-
Investment securities	681 393	842 856	260 217	235 890
Deferred tax assets	-	-	-	244
Net life insurance assets where the deposit (investment) risk is incurred by the insuring party	108 423	104 796	-	-
Other settlements	55 686	24 803	71 336	68 168
Prepayments	-	759	44	290
Other items	74	71	40	-
Total assets	863 956	1 025 554	340 905	306 485
Technical insurance provisions	316 723	423 508	85 825	86 369
Other liabilities	193 886	286 331	52 473	30 209
Prepayments and accruals	3 196	6 472	3 507	5 175
Special funds	49	48	108	86
Total liabilities	513 854	716 359	141 913	121 839
Income	756 394	516 702	182 687	155 653
Profit (loss) for the period	200 204	171 955	40 626	33 017
Other comprehensive income	9 938	7 710	4 724	4 446
Total comprehensive income for the period	210 142	179 665	45 350	37 462
Dividends paid to Santander Bank Polska SA	82 921	75 190	15 192	33 368

The data are taken from unaudited annual financial statements of the companies.

Carrying value of the investments in the associates accounted for using the equity method is different from the share of the Group in their net assets by the amount of goodwill initially recognised in the carrying value of the investment.

26. Intangible assets

Intangible assets Year 2025	Licenses, patents etc.	Other	Expenditure on intangible assets	Total
Value at purchase price - beginning of the period	3 194 291	248 729	349 215	3 792 235
Additions from:
- purchases	-	-	507 630	507 630
- transfers from expenditures	490 670	-	-	490 670
- transfers	1	-	396	397
Decreases from:
- liquidation	(227 919)	(218 393)	(1 258)	(447 570)
- transfers from expenditures	-	-	(490 670)	(490 670)
- transfers	-	-	(3 218)	(3 218)
- disposal of discontinued operations	(393 445)	(30 336)	(8 714)	(432 495)
Value at purchase price - end of the period	3 063 598	-	353 381	3 416 979
Accumulated depreciation - beginning of the period	(2 605 840)	(206 584)	-	(2 812 424)
Additions/decreases from:
- current year amortization from continuing operations	(330 892)	(7 201)	-	(338 093)
- current year amortization from discontinued operations	(35 753)	(3 448)		(39 201)
- liquidation, sale	227 358	207 007	-	434 365
- transfers	-	-	-	-
- disposal of discontinued operations	315 799	10 226	-	326 025
Write down/Reversal of impairment write down	-	-	-	-
Accumulated depreciation- end of the period	(2 429 328)	-	-	(2 429 328)
Balance sheet value
Purchase value	3 063 598	-	353 381	3 416 979
Accumulated depreciation	(2 429 328)	-	-	(2 429 328)
As at 31 December 2025	634 270	-	353 381	987 651

Intangible assets Year 2024	Licenses, patents etc.	Other	Expenditure on intangible assets	Total
Value at purchase price - beginning of the period	2 847 142	248 985	329 480	3 425 607
Additions from:
- purchases	-	-	431 015	431 015
- transfers from expenditures	399 267	6	-	399 273
- transfers	78	-	269	347
Decreases from:	-	-	-
- liquidation	(52 196)	(262)	(8 079)	(60 537)
- transfers from expenditures	-	-	(399 273)	(399 273)
- transfers	-	-	(4 197)	(4 197)
Value at purchase price - end of the period	3 194 291	248 729	349 215	3 792 235
Accumulated depreciation - beginning of the period	(2 350 402)	(193 348)	-	(2 543 750)
Additions/decreases from:
- current year amortization from continuing operations	(253 389)	(10 040)	-	(263 429)
- current year amortization from discontinued operations	(49 408)	(3 458)	-	(52 866)
- liquidation, sale	46 960	262	-	47 222
- transfers	-	-	-	-
Write down/Reversal of impairment write down	399	-	-	399
Accumulated depreciation- end of the period	(2 605 840)	(206 584)	-	(2 812 424)
Balance sheet value
Purchase value	3 194 291	248 729	349 215	3 792 235
Accumulated depreciation	(2 605 840)	(206 584)	-	(2 812 424)
As at 31 December 2024	588 451	42 145	349 215	979 811

27. Goodwill

As at 31 December 2025 the goodwill covered in the amount of PLN 1,688,516 k and arising from the merger of Santander Bank Polska and Kredyt Bank on 4 January 2013.

In the coresponding period (31.12.2024), the goodwill covered in the amount of PLN 1,712,056 k the following items:

· PLN 1,688,516 k - goodwill arising from the merger of Santander Bank Polska and Kredyt Bank on 4 January 2013,

· PLN 23,540 k – goodwill arising from the fact that Santander Bank Polska holds 60% shares of Santander Consumer Bank, which, in turn, has 50% stake in Stellantis Financial Services Polska (formerly PSA Finance Polska). Santander Bank Polska discloses non-controlling interests representing 70% of share capital and voting power at the General Meetings of Stellantis Financial Services Polska (formerly PSA Finance Polska) and, indirectly Stellantis Consumer Financial Services (formerly PSA Consumer Finance Polska).

In accordance with IFRS 3 the goodwill was calculated as the surplus of the cost of acquisition over the fair value of assets and liabilities acquired.

Test for impairment of goodwill arising from the merger between Santander Bank Polska and Kredyt Bank

In 2025 and in the comparative period, the Bank conducted tests for impairment of goodwill arising from the merger with Kredyt Bank on 4 January 2013. The carrying amount as at 31 December 2025 was PLN 1,688,516 k (the same as at 31 December 2024).

Recoverable amount based on value in use

The recoverable amount of cash-generating units is the higher of fair value less costs of disposal and value in use. Value in use which is higher than the fair value less costs of disposal is measured on the basis of a discounted cash flow model relevant for banks and other financial institutions. The future expected cash flows generated by business segments of Santander Bank Polska are in line with the 3-year financial projections of the Bank’s management for 2026-2028.

Taking into account the stability of Santander Bank Polska and sustainable financial performance, and comparing the value in use with the carrying amount of the cash-generating unit, no impairment was identified.

Key assumptions for measuring value in use

For the purposes of goodwill impairment testing Bank applies the following allocation of goodwill to historical business segments. The alocation results from the initial recognition as at acquisition date:

	Segment Retail Banking	Segment Business and Corporate Banking	Segment Corporate & Investment Banking	Segment ALM and Centre	Total
Goodwill	764 135	578 808	222 621	122 952	1 688 516

Due to accepted valuation model, assumptions used to determine the value in use for the individual segments are the same.

Financial projection

The financial projection for 2026–2028 was prepared in line with the strategic and operational plans for 2026–2028 as well as macroeconomic and market forecasts.

Pursuant to the financial projection, the Bank will continue to develop its products and services, focusing on the main product lines, services for retail customers, financing for SMEs, savings products and transactional banking services.

Change of the profit by 10 percentage point would not significantly affect the value of discounted cash flows, value in use, and, consequently, the result of the impairment test.

Discount rate

The discount rate of 12.00 % used in the model is equal to the cost of capital assumed for Santander Bank Polska.

Change of the discount rate by 1 percentage point would not significantly affect the value of discounted cash flows, value in use, and, consequently, the result of the impairment test.

Growth rate in the period beyond the financial projections

The extrapolation of cash flows beyond the 3-year period subject to the financial projection (residual value) was based on an annual growth rate of 2.5%, i.e. equal to the inflation target.

Minimum regulatory capital ratio

An increase in the required capital amount results in a decrease in the amount of capital available for distribution as part of the test. Under Polish law, the value of dividends payable by commercial banks in respect of their prior year profits depends on the fulfilment of the minimum criteria laid down in the KNF’s dividend policy. Details in note 5.

As at 31 December 2025, no goodwill impairment was identified.

28. Property, plant and equipment

Property, plant & equipment not subject to operating lease Year 2025	Land and buildings	IT Equipment	Transportation means	Other fixed assets	Fixed assets under construction	Total
Value at purchase price - beginning of the period	361 797	905 333	183 913	169 388	65 795	1 686 226
Additions from:
- purchases	-	-	15 085	-	356 587	371 672
- transfers from expenditures	1 133	68 939	7 941	10 763	-	88 776
- transfers	28 657	4	4 702	291	8	33 662
Decreases from:
- sale, liquidation, donation	(17 696)	(84 073)	(6 567)	(12 347)	(195)	(120 878)
- transfers from expenditures	-	-	-	-	(321 061)	(321 061)
- transfers	-	(138)	(11 940)	-	(149)	(12 227)
- disposal of discontinued operations	(19 104)	(120 640)	(12 733)	(19 173)	(562)	(172 212)
Value at purchase price - end of the period	354 787	769 425	180 401	148 922	100 423	1 553 958
Accumulated depreciation - beginning of the period	(285 331)	(599 183)	(15 384)	(144 316)	-	(1 044 214)
Additions/disposals from:
- current year amortization from continuing operations	(14 569)	(97 127)	(12 256)	(7 032)	-	(130 984)
- current year amortization from discontinued operations	(12 162)	(11 958)	(2 629)	(1 330)	-	(28 079)
- sale, liquidation, donation	14 589	83 222	1 311	11 457	-	110 579
- transfers	-	-	10 424	(175)	-	10 249
- disposal of discontinued operations	27 683	84 068	3 929	16 330	-	132 010
Write down/Reversal of impairment write down	-	-	-	-	-	-
Accumulated depreciation- end of the period	(269 790)	(540 978)	(14 605)	(125 066)	-	(950 439)
Balance sheet value
Purchase value	354 787	769 425	180 401	148 922	100 423	1 553 958
Accumulated depreciation	(269 790)	(540 978)	(14 605)	(125 066)	-	(950 439)
As at 31 December 2025	84 997	228 447	165 796	23 856	100 423	603 519

Property, plant & equipment not subject to operating lease Year 2024	Land and buildings	IT Equipment	Transportation means	Other fixed assets	Fixed assets under construction	Total
Value at purchase price - beginning of the period	376 765	1 014 352	155 277	182 066	52 216	1 780 676
Additions from:
- purchases	-	-	11 390	-	98 249	109 639
- transfers from expenditures	3 279	69 221	7 987	3 660	-	84 147
- transfers	237	-	31 334	1	3	31 575
Decreases from:
- sale, liquidation, donation	(18 484)	(178 240)	(10 019)	(16 102)	(57)	(222 902)
- transfers from expenditures	-	-	-	-	(84 542)	(84 542)
- transfers	-	-	(12 056)	(237)	(74)	(12 367)
Value at purchase price - end of the period	361 797	905 333	183 913	169 388	65 795	1 686 226
Accumulated depreciation - beginning of the period	(284 270)	(653 803)	(13 120)	(146 978)	-	(1 098 171)
Additions/disposals from:
- current year amortization from continuing operations	(15 316)	(100 243)	(12 428)	(10 352)	-	(138 339)
- current year amortization from discontinued operations	(1 806)	(13 050)	(1 352)	(1 728)		(17 936)
- sale, liquidation, donation	16 067	173 802	1 765	14 737	-	206 371
- transfers	(6)	-	9 751	5	-	9 750
Write down/Reversal of impairment write down	-	(5 889)	-	-	-	(5 889)
Accumulated depreciation- end of the period	(285 331)	(599 183)	(15 384)	(144 316)	-	(1 044 214)
Balance sheet value
Purchase value	361 797	905 333	183 913	169 388	65 795	1 686 226
Accumulated depreciation	(285 331)	(599 183)	(15 384)	(144 316)	-	(1 044 214)
As at 31 December 2024	76 466	306 150	168 529	25 072	65 795	642 012

Property, plant & equipment subject to operating lease Year 2025	IT Equipment	Transportation means	Total
Value at purchase price - beginning of the period		165 092	165 092
Additions from:
- purchases
- transfers from expenditures	327	232 351	232 678
Decreases from:			-
- sale, liquidation, donation	-	(8 610)	(8 610)
- transfers from expenditures	-	-	-
- transfers	-	(15 292)	(15 292)
- disposal of discontinued operations	-	(190 018)	(190 018)
Value at purchase price - end of the period	327	183 523	183 850
Accumulated depreciation - beginning of the period		(12 098)	(12 098)
Additions/decreases from:
- current year amortization from continuing operations	(33)	(14 125)	(14 158)
- current year amortization from discontinued operations	-	(11 768)	(11 768)
- sale, liquidation, donation	-	2 027	2 027
- transfers	-	3 471	3 471
- disposal of discontinued operations	-	14 982	14 982
Write down/Reversal of impairment write down	-	(5 311)	(5 311)
Accumulated depreciation- end of the period	(33)	(22 822)	(22 855)
Balance sheet value
Purchase value	327	183 523	183 850
Accumulated depreciation	(33)	(22 822)	(22 855)
As at 31 December 2025	294	160 701	160 995

Property, plant & equipment subject to operating lease Year 2024	Transportation means	Fixed assets under construction	Total
Value at purchase price - beginning of the period	88 880	-	88 880
Additions from:
- purchases	-	103 429	103 429
- transfers from expenditures	103 429	-	103 429
Decreases from:
- sale, liquidation, donation	(22 511)	-	(22 511)
- transfers from expenditures		(103 429)	(103 429)
- transfers	(4 706)	-	(4 706)
Value at purchase price - end of the period	165 092	-	165 092
Accumulated depreciation - beginning of the period	(6 107)	-	(6 107)
Additions/decreases from:
- current year amortization from continuing operations	(9 632)	-	(9 632)
- current year amortization from discontinued operations	(3 136)		(3 136)
- sale, liquidation, donation	4 372	-	4 372
- transfers	2 405	-	2 405
Write down/Reversal of impairment write down
Accumulated depreciation- end of the period	(12 098)	-	(12 098)
Balance sheet value
Purchase value	165 092	-	165 092
Accumulated depreciation	(12 098)	-	(12 098)
As at 31 December 2024	152 994	-	152 994

29. Right of use assets

Right of use assets Year 2025	Land and buildings	Other	Total
Gross value - begining of the period	1 200 133	9 652	1 209 785
Additions from:
-new lease contracts	128 395	1 164	129 559
-lease modifications and lease period update	112 806	784	113 590
-outlays	-	-	-
Decreases from:	-	-
-lease modifications and lease period update	(89 545)	(34)	(89 579)
- disposal of discontinued operations	(115 298)	-	(115 298)
Gross value - end of the period	1 236 491	11 566	1 248 057
Accumulated depreciation - begining of the period	(715 099)	(5 630)	(720 729)
Additions/ Decreases from:
-current year amortization from continuing operations	(128 291)	(1 359)	(129 650)
- current year amortization from discontinued operations	(1 409)		(1 409)
- lease modifications (including settlement) and lease period update	78 790	34	78 824
- disposal of discontinued operations	68 119	-	68 119
Impairment write down/Reversal of impairment write down *	(622)	(4)	(626)
Accumulated depreciation- end of the period	(698 512)	(6 959)	(705 471)
Balance sheet value
Gross amount	1 236 491	11 566	1 248 057
Accumulated depreciation	(698 512)	(6 959)	(705 471)
As at 31 December 2025	537 979	4 607	542 586

*The recognised impairment allowance results from the closure of the bank's branches, and relates to the entire carrying amount of these branches

Right of use assets Year 2024	Land and buildings	Other	Total
Gross value - begining of the period	1 128 058	8 619	1 136 677
Additions from:
-new lease contracts	25 943	717	26 660
-lease modifications and lease period update	136 372	1 399	137 771
-outlays	745	-	745
Decreases from:	-	-
-lease modifications and lease period update	(90 985)	(1 083)	(92 068)
Gross value - end of the period	1 200 133	9 652	1 209 785
Accumulated depreciation - begining of the period	(636 875)	(5 506)	(642 381)
Additions/ Decreases from:
- current year amortization from continuing operations	(139 173)	(1 052)	(140 225)
-current year amortization from discontinued operations	(1 409)		(1 409)
-lease modifications (including settlement) and lease period update	70 532	965	71 497
Impairment write down/Reversal of impairment write down *	(8 174)	(37)	(8 211)
Accumulated depreciation- end of the period	(715 099)	(5 630)	(720 729)
Balance sheet value
Gross amount	1 200 133	9 652	1 209 785
Accumulated depreciation	(715 099)	(5 630)	(720 729)
As at 31 December 2024	485 034	4 022	489 056

*The recognised impairment allowance results from the closure of the bank's branches, and relates to the entire carrying amount of these branches

In 2025, the Bank continued the project of relocation to the new headquarters in Warsaw. The first stage was completed: the new building located at Plac Europejski was commissioned and the necessary IT infrastructure was set up. The Bank also recognised the right-of-use assets (in the initial value of PLN 113,454k) and the corresponding lease liabilities.

30. Deferred tax assets

Deferred tax assets	31.12.2025	Changes recognised in other comprehensive income	Changes recognised in profit or loss	Changes in temporary differences	Change due to the sale of discontinued operations	31.12.2024
Allowance for expected credit losses	1 014 474	-	309 067	309 067	(205 131)	910 538
Valuation of derivative financial instruments	3 069 542	-	1 385 723	1 385 723		1 683 819
Other provisions	412 211	-	218 611	218 611	(94 946)	288 546
Deferred income	102 690	-	4 224	4 224	(31 094)	129 560
Difference between the accounting value and the tax value of leased assets	358 530	-	62 778	62 778	(288 527)	584 279
Unrealised interest expenses on loans, deposits and securities	141 932	-	31 921	31 921	(124 809)	234 820
Tax loss	24 530	-	12 870	12 870		11 660
Other negative temporary differences	12 463	-	6 653	6 653	(1 445)	7 255
Total assets of deferred tax	5 136 372	-	2 031 847	2 031 847	(745 952)	3 850 477

Deferred tax liabilities

31.12.2025

Changes recognised in other comprehensive income

Changes recognised

in profit or loss

Changes in temporary differences

Change due to the sale of discontinued operations

31.12.2024

Valuation of cash flow hedging instruments	(224 670)	(213 427)	-	(213 427)	6 015	(17 258)
Valuation of investment securities	(60 070)	(152 630)	-	(152 630)	20 521	72 039
Provisions for retirement allowances	(267)	(925)	-	(925)	854	(196)
Valuation of derivative financial instruments	(3 271 873)		(1 566 673)	(1 566 673)	-	(1 705 200)
Cost of credit agency and fees settled in future periods	(88 717)		(5 511)	(5 511)	(188 015)	104 809
Unrealised interest income on loans, securities and interbank deposits	(483 247)		13 859	13 859	100 703	(597 809)
Difference between the accounting value and the tax value of leased assets	(137 360)		(49 269)	(49 269)	6 979	(95 070)
Valuation of shares / interests in associated	(181 285)		(4 470)	(4 470)	-	(176 815)
Other positive temporary differences	(22 518)		(3 185)	(3 185)	1 948	(21 281)
Total liabilities of deferred tax	(4 470 007)	(366 982)	(1 615 249)	(1 982 231)	(50 995)	(2 436 781)
Total effect of temporary differences	666 365	(366 982)	416 598	49 616	(796 947)	1 413 696
Deferred tax liability (presented in the statement of financial position)	432	-	(254)	(254)	-	686
Deferred tax assets (presented in the statement of financial position) – disclosed under group’s liabilities related to sale	666 797	(366 982)	416 344	49 362		1 414 382

*** including a tax of PLN 579,721k on the sale of SCB shares In relation to the sale of SCB shares, the Bank set the tax deductible acquisition cost based on the share exchange: the nominal value of own shares issued at the time of acquisition was used as the acquisition cost for the purpose of determining the taxable income from the sale of SCB shares. The tax on the difference between the tax base and the carrying amount of the sold SCB shares is PLN 399,489k.

Deferred tax assets	31.12.2024	Changes recognised in other comprehensive income	Changes recognised in profit or loss	Changes in temporary differences	31.12.2023
Allowance for expected credit losses	910 538	-	(43 448)	(43 448)	953 986
Valuation of derivative financial instruments	1 683 819	-	(4 471)	(4 471)	1 688 290
Other provisions	288 546	-	7 910	7 910	280 636
Deferred income	135 446	-	10 174	(85 153)	125 272
Difference between the accounting value and the tax value of leased assets	584 279	-	14 956	14 956	569 323
Unrealised interest expenses on loans, deposits and securities	234 820	-	(17 801)	(17 801)	252 621
Tax loss	11 660	-	(35 301)	(35 301)	46 961
Other negative temporary differences	7 255	-	43	43	7 212
Total assets of deferred tax	3 856 363	-	(67 938)	(163 265)	3 924 301

Deferred tax liabilities	31.12.2024	Changes recognised in other comprehensive income	Changes recognised in profit or loss	Changes in temporary differences	31.12.2023
Valuation of cash flow hedging instruments	(17 258)	113 696	-	113 696	(130 954)
Valuation of investment securities	72 039	(131 465)	-	(131 465)	203 504
Provisions for retirement allowances	(196)	160	-	160	(356)
Valuation of derivative financial instruments	(1 705 200)	-	(140 357)	(140 357)	(1 564 843)
Unrealised interest income on loans, securities and interbank deposits	98 924		(110 474)	(110 474)	209 398
Difference between the accounting value and the tax value of leased assets	(597 809)	-	(5 087)	(5 087)	(592 722)
Valuation of shares / interests in associated	(95 070)	-	1 408	1 408	(96 478)
Other positive temporary differences	(176 815)	-	58	58	(176 873)
Total liabilities of deferred tax	(21 282)	-	2 941	2 941	(24 223)
Total effect of temporary differences	(2 442 667)	(17 609)	(251 511)	(269 120)	(2 173 547)
Deferred tax liability (presented in the statement of financial position)	1 413 696	(17 609)	(319 449)	(432 385)	1 750 754
Deferred tax assets (presented in the statement of financial position	686	-	251	251	435

.Movements on deferred tax	31.12.2025	31.12.2024
As at the beginning of the period	1 414 382	1 751 189
Changes recognised in income statement	421 069	(318 318)
Changes recognised in other comprehensive income	(366 982)	(18 038)
Other	(801 672)	(451)
Balance at the end of the period	666 797	1 414 382

31. Other assets

Other assets	31.12.2025	31.12.2024
Interbank settlements	156 963	-
Sundry debtors	2 999 774	2 446 051
Prepayments	312 440	329 290
Repossessed assets	-	12
Settlements of stock exchange transactions	142 346	43 296
Other	22 892	40 791
Total	3 634 415	2 859 440
of which financial assets *	3 299 083	2 489 347

* Financial assets include all items of other assets, with the exception of Prepayments, Repossessed assets and Other.

As at 31.12.2025, ECL allowance for other assets was PLN 67,581 k (31.12.2024 PLN 138,879 k).

The significant majority of 'Other assets' items are non-past due and unimpaired. The most significant items concern the companies Allianz, KDPW, WSE and a number of other entities with a good financial standing and good cooperation history, most of them rated A- (Fitch).

32. Deposits from banks

Deposits from banks	31.12.2025	31.12.2024
Term deposits	265 897	100 625
Loans received from banks	899 359	2 385 925
Current accounts	1 682 024	2 662 110
Total	2 847 280	5 148 660
Short-term	2 782 280	4 736 160
Long-term (over 1 year)	65 000	412 500

Fair value of “Deposits from banks” is presented in note 46.

Movements in loans received from banks	1.01.2025-31.12.2025	1.01.2024-31.12.2024
As at the beginning of the period	2 385 925	1 377 271
Increase (due to:)	2 266 655	3 973 353
- loans received	2 217 582	3 886 121
- interest on loans received	49 073	86 974
- FX differences and other changes	-	258
Decrease (due to):	(3 753 221)	(2 964 699)
- repayment of loans	(2 449 298)	(2 885 337)
- interest repayment	(50 400)	(79 362)
- change due to the sale of discontinued operations	(1 227 188)	-
- FX differences and other changes	(26 335)	-
As at the end of the period	899 359	2 385 925

33. Deposits from customers

Deposits from customers	31.12.2025	31.12.2024
Deposits from individuals	123 689 332	127 764 517
Term deposits	39 193 260	47 896 484
Current accounts	84 453 810	79 583 654
Other	42 262	284 379
Deposits from enterprises	95 150 034	92 782 556
Term deposits	22 523 898	24 792 342
Current accounts	69 201 426	64 171 535
Loans received from financial institution	391 248	906 079
Other	3 033 462	2 912 600
Deposits from public sector	11 303 198	11 481 689
Term deposits	431 141	1 143 982
Current accounts	10 645 064	10 316 117
Other	226 993	21 590
Total	230 142 564	232 028 762
Short-term	228 506 432	229 692 641
Long-term (over 1 year)	1 636 132	2 336 121

As at 31.12.2025 deposits held as collateral totaled PLN 1 032 020 k (as at 31.12.2024 - PLN 2 101 980 k).

Fair value of “Deposits from customers” is presented in note 46.

Movements in loans received from other financial institutions	1.01.2025-31.12.2025	1.01.2024-31.12.2024
As at the beginning of the period	906 079	950 381
Increase (due to:)	30 251	375 563
- loans received	-	325 000
- interest on loans received	30 186	50 563
- FX differences and other changes	65	-
Decrease (due to):	(545 082)	(419 865)
- repayment of loans	(220 852)	(367 352)
- interest repayment	(32 150)	(51 732)
- change due to the sale of discontinued operations	(292 080)	-
- FX differences and other changes	-	(781)
As at the end of the period	391 248	906 079

The Group did not note any violations of contractual terms related to liabilities in respect of loans received.

34. Subordinated liabilities

Subordinated liabilities in issue on 31.12.2025

Subordinated liabilities	Nominal value	Currency	Redemption date	Book Value (In thousands of PLN)
Issue 3	137 100	EUR	22.05.2027	587 114
Issue 4	1 000 000	PLN	05.04.2028	1 014 851
Total				1 601 965

Subordinated liabilities in issue on 31.12.2024

Subordinated liabilities	Nominal value	Currency	Redemption date	Book Value (In thousands of PLN)
Issue 2	120 000	EUR	03.12.2026	515 085
Issue 3	137 100	EUR	22.05.2027	594 938
Issue 4	1 000 000	PLN	05.04.2028	1 017 962
SCF Madrid	100 000	PLN	18.05.2028	100 913
Total				2 228 898

.

Movements in subordinated liabilities	1.01.2025-31.12.2025	1.01.2024-31.12.2024
As at the beginning of the period	2 228 898	2 686 343
Increase (due to):	129 407	185 685
- interest on subordinated loans	129 407	185 685
Decrease (due to):	(756 340)	(643 130)
- repayment of subordinated loans	(507 744)	(431 270)
- interest repayment	(137 022)	(190 522)
- FX differences	(10 661)	(21 338)
- change due to the sale of discontinued operations	(100 913)	-
As at the end of the period	1 601 965	2 228 898
Short-term	23 465	31 993
Long-term (over 1 year)	1 578 500	2 196 905

Other details on subordinated liabilities are disclosed in note 5.

35. Debt securities in issue

Debt securities in issue on 31.12.2025

Name of the entity issuing the securities	Type of securities	Nominal value	Currency	Date of issue	Redemption date	Book Value (In thousands of PLN)
Santander Bank Polska S.A.	Bonds	368 500	PLN	09.12.2025	30.09.2034	371 106
Santander Bank Polska S.A.	Bonds	3 000 000	PLN	01.12.2025	01.12.2028	3 013 249
Santander Bank Polska S.A.	Bonds	500 000	EUR	07.10.2025	07.10.2031	2 123 019
Santander Bank Polska S.A.	Bonds	320 000	PLN	26.06.2025	31.03.2036	330 607
Santander Bank Polska S.A.	Bonds	394 000	PLN	17.12.2024	07.02.2033	406 455
Santander Bank Polska S.A.	Bonds	1 800 000	PLN	30.09.2024	30.09.2027	1 827 426
Santander Bank Polska S.A.	Bonds	145 949	PLN	26.06.2024	14.02.2034	151 365
Santander Bank Polska S.A.	Bonds	1 900 000	PLN	02.04.2024	02.04.2027	1 928 801
Santander Leasing S.A.	Bonds	220 000	PLN	18.12.2025	18.12.2026	219 557
Santander Leasing S.A.	Bonds	340 000	PLN	23.10.2025	23.10.2026	342 047
Santander Leasing S.A.	Bonds	600 000	PLN	24.07.2025	24.07.2026	604 104
Santander Leasing S.A.	Bonds	240 000	PLN	04.04.2025	04.04.2026	239 661
Santander Leasing S.A.	Bonds	100 000	PLN	19.03.2025	19.03.2026	100 068
Santander Factoring Sp. z o.o.	Bonds	505 000	PLN	23.12.2025	23.06.2026	504 345
Santander Factoring Sp. z o.o.	Bonds	260 000	PLN	11.12.2025	11.03.2026	260 409
Santander Factoring Sp. z o.o.	Bonds	200 000	PLN	11.12.2025	11.06.2026	200 133
Santander Factoring Sp. z o.o.	Bonds	440 000	PLN	23.10.2025	23.04.2026	439 885
Santander Factoring Sp. z o.o.	Bonds	200 000	PLN	13.10.2025	13.01.2026	200 375
Santander Factoring Sp. z o.o.	Bonds	100 000	PLN	03.09.2025	03.09.2026	100 087
Santander Factoring Sp. z o.o.	Bonds	300 000	PLN	20.08.2025	19.02.2026	300 252
Santander Factoring Sp. z o.o.	Bonds	850 000	PLN	19.08.2025	19.02.2026	850 720
Total						14 513 671

The total value of financial liabilities (including liabilities in respect of debt securities in issue) arising from these consolidated financial statements does not differ significantly from the projection of financial liabilities published on 20 December 2025 as part of the Bank’s fulfilment of information obligations under Article 35(1) of the Bonds Act.

Debt securities in issue on 31.12.2024

Name of the entity issuing the securities	Type of securities	Nominal value	Currency	Date of issue	Redemption date	Book Value (In thousands of PLN)
Santander Bank Polska S.A.	Bonds	394 000	PLN	17.12.2024	07.02.2033	396 216
Santander Bank Polska S.A.	Bonds	1 800 000	PLN	30.09.2024	30.09.2027	1 833 250
Santander Bank Polska S.A.	Bonds	219 997	PLN	26.06.2024	31.12.2033	228 796
Santander Bank Polska S.A.	Bonds	1 900 000	PLN	02.04.2024	02.04.2027	1 934 817
Santander Bank Polska S.A.	Bonds	3 100 000	PLN	29.11.2023	30.11.2026	3 121 301
Santander Leasing S.A.	Bonds	150 000	PLN	20.12.2024	18.12.2025	149 757
Santander Leasing S.A.	Bonds	169 062	PLN	23.10.2024	23.10.2025	170 606
Santander Leasing S.A.	Bonds	365 000	PLN	23.07.2024	23.07.2025	368 482
Santander Factoring Sp. z o.o.	Bonds	480 000	PLN	23.12.2024	23.06.2025	479 788
Santander Factoring Sp. z o.o.	Bonds	120 500	PLN	23.10.2024	23.04.2025	120 516
Santander Factoring Sp. z o.o.	Bonds	200 000	PLN	08.10.2024	08.01.2025	200 717
Santander Factoring Sp. z o.o.	Bonds	390 000	PLN	19.08.2024	19.02.2025	390 541
Santander Factoring Sp. z o.o.	Bonds	100 000	PLN	19.08.2024	08.08.2025	100 109
Santander Factoring Sp. z o.o.	Bonds	110 000	PLN	19.08.2024	19.05.2025	110 055
Santander Consumer Multirent sp. z o.o.	Bonds	300 000	PLN	24.06.2024	24.06.2025	300 142
Santander Consumer Multirent sp. z o.o.	Bonds	50 000	PLN	26.05.2023	31.03.2025	49 984
S.C. Poland Consumer 23-1 DAC	Bonds	1 000 000	PLN	01.12.2022	16.11.2032	1 002 889
SCM POLAND AUTO 2019-1 DAC	Bonds	891 000	PLN	20.07.2020	31.07.2028	893 197
Total						11 851 163

Movements in debt securities in issue	1.01.2025-31.12.2025	1.01.2024-31.12.2024
As at the beginning of the period	11 851 163	9 247 159
Increase (due to):	11 980 875	8 893 862
- debt securities issued	11 246 150	8 159 564
- interest on debt securities in issue	734 725	734 298
Decrease (due to):	(9 318 367)	(6 289 858)
- debt securities repurchase	(6 344 548)	(5 577 382)
- interest repayment	(707 600)	(688 542)
- FX differences	(14 600)	(18 160)
- change due to the sale of discontinued operations	(2 246 212)	-
- other changes	(5 407)	(5 774)
As at the end of the period	14 513 671	11 851 163

36. Provisions for financial liabilities and guarantees granted

Provisions for financial liabilities and guarantees granted	31.12.2025	31.12.2024
Provisions for financial commitments to grant loans and credit lines	57 988	68 804
Provisions for financial guarantees	19 735	20 210
Other provisions	1 607	4 905
Total	79 330	93 919

Change in provisions for financial liabilities and guarantees granted	31.12.2025
As at the beginning of the period	93 919
Provision charge	371 476
Write back	(382 458)
Other changes	(545)
Change due to disposal of discontinued operations	(3 062)
As at the end of the period	79 330
Short-term	36 746
Long-term	42 584


Change in provisions for financial liabilities and guarantees granted	31.12.2024
As at the beginning of the period	123 085
Provision charge	363 418
Write back	(391 637)
Other changes	(947)
As at the end of the period	93 919
Short-term	55 033
Long-term	38 886

37. Other provisions

Other provisions	31.12.2025	31.12.2024
Provision for legal risk connected with foreign currency mortgage loans	2 194 702	1 915 242
Provisions for reimbursement of costs related to early repayment of consumer and mortgage loans	17 131	30 623
Provisions for legal claims and other	90 670	129 975
Total	2 302 503	2 075 840

Change in other provisions 1.01.2025 - 31.12.2025	Provision for legal risk connected with foreign currency mortgage loans*	Provisions for reimbursement of costs related to early repayment of consumer loans	Provisions for legal claims and other	Total
As at the beginning of the period	1 915 242	30 623	129 975	2 075 840
Provision charge/relase	990 831	-	134 911	1 125 742
Utilization	(145 375)	(4 497)	(143 266)	(293 138)
Other	(112 748)	-	-	(112 748)
Change due to the sale of discontinued operations	(453 248)	(8 995)	(30 950)	(493 193)
As at the end of the period	2 194 702	17 131	90 670	2 302 503

*Detailed information are described in note 47

38. Other liabilities

Other liabilities	31.12.2025	31.12.2024
Settlements of stock exchange transactions	130 027	30 395
Interbank	678 320	600 684
Employee provisions	499 872	538 861
Sundry creditors	2 218 313	1 401 524
Liabilities from contracts with customers	168 127	219 021
Public and law settlements	200 369	183 329
Accrued liabilities	539 116	519 694
Liabilities to leasing contractors	121 058	189 333
Other	3 828	16 339
Total	4 559 030	3 699 180
of which financial liabilities *	3 686 834	2 741 630

*Financial liabilities include all items of other liabilities with the exception of employee provisions, public and law settlements, liabilities from contracts with customers and other.

Change in employee provisions 1.01.2025 - 31.12.2025		of which: Provisions for retirement allowances
As at the beginning of the period	538 861	*69 985*
Provision charge	490 956	7 042
Utilization	(386 048)	-
Release of provisions	(90 420)	(7 396)
Change due to the sale of discontinued operations	(53 477)	(5 903)
As at the end of the period	499 872	*63 728*
Short-term	436 144	-
Long-term	63 728	63 728

Change in employee provisions 1.01.2024 - 31.12.2024		of which: Provisions for retirement allowances
As at the beginning of the period	514 628	*63 554*
Provision charge	456 984	9 488
Utilization	(376 509)	(59)
Release of provisions	(56 242)	(2 998)
As at the end of the period	538 861	*69 985*
Short-term	468 876	-
Long-term	69 985	69 985

Employee related provisions consists of items outlined in note 54.

39. Share capital

31.12.2025

Series/issue	Issue	Type of preferences	Limitation of rights to shares		Number of shares	Nominal value of series/issue in PLN k
A	bearer	none	none		5 120 000	51 200
B	bearer	none	none		724 073	7 241
C	bearer	none	none		22 155 927	221 559
D	bearer	none	none		1 470 589	14 706
E	bearer	none	none		980 393	9 804
F	bearer	none	none		2 500 000	25 000
G	bearer	none	none		40 009 302	400 093
H	bearer	none	none		115 729	1 157
I	bearer	none	none		1 561 618	15 616
J	bearer	none	none		18 907 458	189 075
K	bearer	none	none		305 543	3 055
L	bearer	none	none		5 383 902	53 839
M	bearer	none	none		98 947	990
N	bearer	none	none		2 754 824	27 548
O	bearer	none	none		101 009	1 010
				102 189 314		1 021 893

Nominal value of one share is PLN 10. All issued shares are fully paid.

As at 31.12.2025 the shareholders having minimum 5% of the total number of votes at the Santander Bank Polska General Meeting of Shareholders was Banco Santanderwhich with a controlling stake of 58.70% stake until the date of the sale transaction, Allianz Polska Otwarty Fundusz Emerytalny with a controlling stake of 5,23% stake and 5.01% Nationale-Nederlanden Otwarty Fundusz Emerytalny funds (managed by Nationale-Nederlanden Powszechne Towarzystwo Emerytalne S.A.).

On 9 January 2026, Banco Santander S.A. sold a stake of 49% to Erste Group Bank AG, thus the share of Banco Santander S.A. decreased to 9.7%. Details of which are described in note 57.

31.12. 2024

Series/issue	Issue	Type of preferences	Limitation of rights to shares		Number of shares	Nominal value of series/issue in PLN k
A	bearer	none	none		5 120 000	51 200
B	bearer	none	none		724 073	7 241
C	bearer	none	none		22 155 927	221 559
D	bearer	none	none		1 470 589	14 706
E	bearer	none	none		980 393	9 804
F	bearer	none	none		2 500 000	25 000
G	bearer	none	none		40 009 302	400 093
H	bearer	none	none		115 729	1 157
I	bearer	none	none		1 561 618	15 616
J	bearer	none	none		18 907 458	189 075
K	bearer	none	none		305 543	3 055
L	bearer	none	none		5 383 902	53 839
M	bearer	none	none		98 947	990
N	bearer	none	none		2 754 824	27 548
O	bearer	none	none		101 009	1 010
				102 189 314		1 021 893

Nominal value of one share is PLN 10. All issued shares are fully paid.

As at 31.12.2024 shareholders having minimum 5% of the total number of votes at the Santander Bank Polska General Meeting of Shareholders was Banco Santander with a controlling stake of 62.20% stake and 5.01% Nationale-Nederlanden Otwarty Fundusz Emerytalny funds (managed by Nationale-Nederlanden Powszechne Towarzystwo Emerytalne S.A.).

40. Other reserve capital

Other reserve capital	31.12.2025	31.12.2024
General banking risk fund	649 810	649 810
Share premium	7 981 974	7 981 974
Other reserves of which:	14 765 824	15 793 012
Reserve capital	13 811 346	15 113 833
Supplementary capital	954 478	1 336 624
Adjustment to equity from acquisition/loss of controlling interest in subsidiaries	-	(657 445)
Total	23 397 608	24 424 796

Share (issue) premium is created from surplus over the nominal value of shares sold less costs of share issuance and constitutes the Bank’s supplementary capital.

Reserve capital as at 31.12.2025 includes among others share option scheme charge of PLN 143 949 k and share base incentive scheme of 199 931 k and reserve capital as at 31.12.2024 includes share option scheme charge of PLN 143 949 k and share base incentive scheme of 178 225 k.

Other movements of other reserve capital are presented in “movements on consolidated equity” for 2025 and 2024.

Statutory reserve (supplementary) capital is created from net profit appropriation in line with the prevailing banking legislation and the Bank’s Statute. The capital is not subject to split and is earmarked for covering balance sheet losses. Allocations from profit for the current year to reserve capital should amount to at least 8% of profit after tax and are made until supplementary capital equals at least one third of the Bank’s share capital. The amount of allocations is adopted by the General Meeting of Shareholders.

The reserve capital is created out of allocations from the after-tax profit, in an amount resolved by the General Shareholders’ Meeting and from other sources.

The reserve capital is earmarked for covering balance sheet losses, should they exceed the supplementary capital, or for other purposes, particularly for dividend pay-outs. Decisions on using the reserve capital are taken by the General Shareholders’ Meeting.

41. Revaluation reserve

Revaluation reserve 1.01.2025 - 31.12.2025	Total gross	Deferred tax adjustment	Total net
Opening balance, of which:	(269 841)	51 194	(218 647)
Debt securities measured at fair value through other comprehensive income	(800 841)	152 161	(648 680)
Equity securities measured at fair value through other comprehensive income	435 977	(82 913)	353 064
Valuation of cash flow hedging instruments	95 722	(18 187)	77 535
Actuarial gains on retirement allowances	(699)	133	(566)

Change in valuation of debt securities measured at fair value through other comprehensive income	778 417	(150 780)	627 637
Transfer from revaluation reserve to profit and loss resulting from the sale of debt securities measured at fair value through other comprehensive income	(15 397)	3 849	(11 548)
Transfer from revaluation reserve to profit and loss due to fair value measurement of securities covered by hedge accounting	(107 908)	26 977	(80 931)
Change in valuation of debt securities measured at fair value through other comprehensive income - change due to the sale of discontinued operations	(43 444)	12 769	(30 675)
Change in valuation of equity securities measured at fair value through other comprehensive income	24 513	(23 044)	1 469
Change in valuation of equity securities measured at fair value through other comprehensive income - change due to the sale of discontinued operations	(742)	141	(601)
Cash flow hedge - effective portion of the hedging relationship included in revaluation reserve	845 656	(210 198)	635 458
Cash flow hedge - effective portion of the hedging relationship included in revaluation reserve - change due to the sale of discontinued operations	(12 593)	3 716	(8 877)
Change in provision for retirement allowances – actuarial gains/losses gross	3 776	(912)	2 864
Change in provision for retirement allowances – actuarial gains/losses gross - change due to the sale of discontinued operations	(2 227)	512	(1 715)

Closing balance, of which:	1 200 210	(285 776)	914 434
Debt securities measured at fair value through other comprehensive income	(189 173)	44 976	(144 197)
Equity securities measured at fair value through other comprehensive income	459 748	(105 816)	353 932
Valuation of cash flow hedging instruments	928 785	(224 669)	704 116
Actuarial gains on retirement allowances	850	(267)	583

Revaluation reserve 1.01.2024 - 31.12.2024	Total gross	Deferred tax adjustment	Total net
Opening balance, of which:	(368 657)	69 969	(298 688)
Debt securities measured at fair value through other comprehensive income	(1 308 583)	248 631	(1 059 952)
Equity securities measured at fair value through other comprehensive income	249 832	(47 545)	202 287
Valuation of cash flow hedging instruments	689 291	(130 965)	558 326
Actuarial gains on retirement allowances	803	(152)	651

Change in valuation of debt securities measured at fair value through other comprehensive income	554 836	(105 518)	449 318
Transfer from revaluation reserve to profit and loss resulting from the sale of debt securities measured at fair value through other comprehensive income	(14 481)	2 852	(11 629)
Transfer from revaluation reserve to profit and loss due to fair value measurement of securities covered by hedge accounting	(32 613)	6 196	(26 417)
Change in valuation of equity securities measured at fair value through other comprehensive income	190 361	(35 368)	154 993
Transfer from revaluation reserve to retained earnings profit on sale of equity securities	(4 216)	-	(4 216)
Cash flow hedge - effective portion of the hedging relationship included in revaluation reserve	(593 569)	112 778	(480 791)
Change in provision for retirement allowances – actuarial gains/losses gross	(1 502)	285	(1 217)

Closing balance, of which:	(269 841)	51 194	(218 647)
Debt securities measured at fair value through other comprehensive income	(800 841)	152 161	(648 680)
Equity securities measured at fair value through other comprehensive income	435 977	(82 913)	353 064
Valuation of cash flow hedging instruments	95 722	(18 187)	77 535
Actuarial gains on retirement allowances	(699)	133	(566)

.

42. Non - controlling interests

Name of the subsidiary	Country of incorporation and place of business	Percentage share of non-controlling interests in share capital / voting rights		Net profit for the period attributable to non-controlling interests		Accumulated non-controlling interests
		31.12.2025	31.12.2024	31.12.2025	31.12.2024	31.12.2025	31.12.2024
Santander Towarzystwo Funduszy Inwestycyjnych S.A.	Poland Poznań	50,00	50,00	70 197	56 476	79 554	65 826
Santander Consumer Bank S.A.*	Poland Wrocław	-	40,00	215 831	(24 410)	-	1 847 893
Total				286 028	32 066	79 554	1 913 719

*Due to the sale of Santander Consumer Bank S.A., SCB Group’s data are presented as discontinued operations. Details in Note 48.

The table below presents condensed financial information regarding each subsidiaries which have a significant non-controlling interests to the Group:

	Santander Towarzystwo Funduszy Inwestycyjnych SA		Santander Consumer Bank Group*
	31.12.2025	31.12.2024	31.12.2025	31.12.2024
Cash and cash equivalents	159 068	132 445	-	719 351
Loans and advances to customers	-	-	-	26 317 357
Investments in subsidiaries	-	-	-	258 077
Investment securities	19 810	19 757	-	5 071 903
Net deferred tax assets	9 747	9 174	-	582 746
Other items	44 723	44 824	-	519 920
Total assets	233 348	206 200	-	33 469 354
Deposits from banks	-	-	-	6 376 939
Deposits from customers	-	-	-	18 421 371
Debt securities in issue	-	-	-	2 246 212
Other items	74 239	74 547	-	1 858 610
Total liabilities	74 239	74 547	-	28 903 132

Income	355 435	300 050	3 301 831	2 783 156
Net profit (loss) for the period	140 402	112 954	231 731	(95 529)
Dividends paid to non-controlling shareholers	56 477	46 573	-	-
Total net cash flows:	26 622	65 323	(269 284)	490 729
- from operating activities	144 728	158 392	(152 992)	700 860
- from investing activities	(2 088)	2 572	(2 105 864)	(628 525)
- from financing activities	(116 018)	(95 641)	1 989 572	418 394

*Due to the sale of Santander Consumer Bank S.A., SCB Group’s data are presented as discontinued operations. Details in Note 48.

43. Hedge accounting

Santander Bank Polska Group uses hedging strategies within hedge accounting in line with the risk management principles set out in Note 4 to the financial statements.

Fair value hedges

Santander Bank Polska S.A. uses fair value hedge accounting in relation to fixed-rate debt securities in PLN, EUR and USD.

To hedge the fair value, Santander Bank Polska S.A. uses Interest Rate Swaps (IRS), Currency Interest Rate Swaps (CIRS) and Overnight Index Swaps (OIS) for which the Bank pays a fixed rate and receives a variable rate. The risk being hedged is a change in the fair value of an instrument that is attributable to changes in market interest rates. These transactions do not hedge against changes in the fair value due to credit risk. The hedged amount is equal to the value of the hedged item (the hedge ratio is 1:1).

As at 31 December 2025, the Bank hedged 4.6% of the fixed-rate debt securities using the above instruments.

The Bank conducts prospective and retrospective tests to confirm hedge effectiveness. They are performed at the end of each month. The prospective test is also conducted on the day the hedging relationship is established.

To ensure high effectiveness of the hedging relationship and existence of an economic relationship, the hedging transactions designated by the Bank as fair value hedges meet the following conditions:

· The nominal value of the hedged item is equal to the nominal value of the hedging transaction.

· The interest rate on the hedged item is equal to the interest rate on the fixed leg of the hedging transaction.

· The maturity and repricing periods of the hedged item is equal to or close to the maturity and repricing periods of the hedging item ensuring high effectiveness in offsetting changes in the fair value.

As a result, any ineffectiveness may be attributed only to the variable leg of the hedging transaction. No other sources of ineffectiveness have been identified.

The table below presents the distribution of nominal values of fair value hedges by tenor as at 31 December 2025 and in the comparative period:

	Distribution of nominal values of cash flows
Nominal value of fair value hedging instruments	up to 1 month	from 1 month to 3 months	from 3 months to 1 year	from 1 year to 5 years	over 5 years	Total
31.12.2025
Assets representing derivative hedging instruments	126 801	112 000	1 243 801	1 311 080	511 847	3 305 529
IRS	-	112 000	1 117 000	1 183 000	-	2 412 000
CIRS/OIS	126 801	-	126 801	128 080	511 847	893 529
Liabilities arising from derivative hedging instruments	126 801	112 000	1 243 801	1 311 080	511 847	3 305 529
IRS	-	112 000	1 117 000	1 183 000	-	2 412 000
CIRS/OIS	126 801	-	126 801	128 080	511 847	893 529
31.12.2024
Assets representing derivative hedging instruments	-	2 547 500	448 650	2 809 367	528 037	6 333 554
IRS	-	2 547 500	235 000	2 412 000	-	5 194 500
CIRS/OIS	-	-	213 650	397 367	528 037	1 139 054
Liabilities arising from derivative hedging instruments	-	2 547 500	448 650	2 809 367	528 037	6 333 554
IRS	-	2 547 500	235 000	2 412 000	-	5 194 500
CIRS/OIS	-	-	213 650	397 367	528 037	1 139 054

The table below presents pricing parameters of hedging instruments:

Pricing parameters for hedging instruments	up to 1 month	from 1 month to 3 months	from 3 months to 1 year	from 1 year to 5 years	over 5 years
31.12.2025
Assets representing derivative hedging instruments
Average fixed interest rate	5,0914	5,0878	4,4421	4,8255	4,9639
Average exchange rate (CHF/PLN)	4,5390	4,5390	4,5390	4,5390	4,5390
Average exchange rate (EUR/PLN)	4,2267	4,2267	4,2267	4,2267	4,2267
Average exchange rate (USD/PLN)	3,6016	3,6016	3,6016	3,6016	3,6016
Liabilities arising from derivative hedging instruments
Average fixed interest rate	-	3,2700	2,0789	2,0248	2,8400
Average exchange rate (CHF/PLN)	4,5390	4,5390	4,5390	4,5390	4,5390
Average exchange rate (EUR/PLN)	4,2267	4,2267	4,2267	4,2267	4,2267
Average exchange rate (USD/PLN)	3,6016	3,6016	3,6016	3,6016	3,6016
31.12.2024
Assets representing derivative hedging instruments
Average fixed interest rate	5,4889	5,3813	4,6195	5,0949	4,9847
Average exchange rate (CHF/PLN)	4,5371	4,5371	4,5371	4,5371	4,5371
Average exchange rate (EUR/PLN)	4,2730	4,2730	4,2730	4,2730	4,2730
Average exchange rate (USD/PLN)	4,1012	4,1012	4,1012	4,1012	4,1012
Liabilities arising from derivative hedging instruments
Average fixed interest rate	-	5,4327	1,5514	2,0422	2,8400
Average exchange rate (CHF/PLN)	4,5371	4,5371	4,5371	4,5371	4,5371
Average exchange rate (EUR/PLN)	4,2730	4,2730	4,2730	4,2730	4,2730
Average exchange rate (USD/PLN)	4,1012	4,1012	4,1012	4,1012	4,1012

The table below presents nominal values and carrying amounts of derivative hedging instruments designated as fair value hedges as at 31 December 2025 and in the comparative period:

	31.12.2025	31.12.2024
Hedging instruments designated as fair value hedges	Hedged item: Fixed-coupon bonds		Hedged item: Fixed-coupon bonds	Hedged item: Fixed-rate loan portfolio	Hedged item: Issued bonds
Nominal value of hedging instrument	3 305 529		6 333 554	-	-
Hedging derivatives – assets (carrying amount)	61 758		173 150	-	-
Hedging derivatives – liabilities (carrying amount)	31 738		95 108	-	-
Line item in the statement of financial position that includes the hedging instrument	Hedging derivatives (IRS, CIRS, OIS)		Hedging derivatives (IRS, CIRS, OIS)	Hedging derivatives (IRS)	Hedging derivatives (CIRS)
Hedged risk	Interest rate risk		Interest rate risk	Interest rate risk	Interest rate risk
Period over which instruments have impact on the Bank’s results	up to 2033		up to 2033	up to 2024	up to 2024
Change in fair value of the hedging instrument used as the basis for recognising hedge ineffectiveness for the period	(105 795)		(34 000)	(5 317)	(678)
Value of hedge ineffectiveness recognised in profit or loss for the period	6 128		4 015	-	-

The table below presents the carrying amount of the hedged item and the accumulated amount of fair value hedge adjustments on the hedged item recognised in the income statement and included in the carrying amount.

31.12.2025

31.12.2024

Items subject to fair value hedge accounting	Fixed-coupon bonds	Fixed-coupon bonds	Fixed-rate loan portfolio	Issued bonds
Carrying amount of the hedged item, including:
Assets	3 413 437	6 228 933	-	-
Liabilities	-	-	-	-
Accumulated amount of fair value hedge adjustments on the hedged item included in profit and loss and in the carrying amount, including:
Assets	107 908	32 613	4 563	-
Liabilities	-	-	-	407
Line item in the statement of financial position that includes the hedged instrument	Debt securities measured at fair value through other comprehensive income	Debt securities measured at fair value through other comprehensive income	Loans and advances to customers	Debt securities in issue

Cash flow hedging

Santander Bank Polska S.A. uses hedge accounting for future cash flows with respect to variable-rate commercial and mortgage loans in PLN and denominated in EUR and CHF, with maximum maturity of 30 years, and with respect to own securities issues in EUR with maturity of 6 years.

The hedging strategies used by Santander Bank Polska S.A. are designed to hedge the Bank’s exposures against the risk of changes in the value of future cash flows resulting from interest rate risk or – in the case of credit portfolios denominated in a foreign currency and own securities issues in EUR – also from currency risk.

Hedging relationships are established using Interest Rate Swaps (IRS), Currency Interest Rate Swaps (CIRS) and Cross Currency Interest Rate Swaps (CCIRS). The hedged amount is equal to the value of the hedged item (the hedge ratio is 1:1). As at 31 December 2025, the Bank used the above instruments to hedge:

· interest rate risk component related to changes in market interest rates with respect to:

▪ over 75% of variable-rate commercial and mortgage loans in PLN, excluding loans granted to the subsidiaries;

▪ over 70% of variable-rate commercial and mortgage loans in EUR, excluding loans granted to the subsidiaries;

· FX risk component with respect to:

▪ below 2% of variable-rate commercial and mortgage loans in EUR, excluding loans granted to the subsidiaries;

▪ below 25% of variable-rate commercial and mortgage loans in CHF;

· interest rate risk component related to changes in market reference rates and FX risk component with respect to:

▪ 50% of own securities issues in EUR.

At the end of each month, the Bank conducts retrospective and prospective effectiveness tests of existing hedging transactions. On the hedge establishment date, prospective tests are also conducted to confirm high effectiveness of the hedge and make sure that there is an economic relationship between the hedged item and the hedging instrument. To measure hedge effectiveness, the Bank uses the hypothetical derivative method whereby the hedged item is reflected by a derivative transaction with specific characteristics.

Potential hedge ineffectiveness may be attributed to the following factors:

· for relationships hedging interest rate risk:

▪ mismatch between the repricing dates of interest rates on hedged loans and the repricing dates of reference rates on IRS variable leg;

▪ interest payments based on a fixed rate received by the Bank;

▪ changes in cash flows arising from prepayments;

· for relationships hedging FX risk:

▪ mismatch in respect of initial recognition if a derivative designated to the hedging relationship has been concluded before the establishment of that relationship;

▪ mismatch of the base (interest rate revaluation frequency);

▪ changes in cash flows arising from prepayments;

· for relationships hedging both interest rate risk and FX risk:

▪ mismatch in respect of initial recognition if a derivative designated to the hedging relationship has been concluded before the establishment of that relationship.

No other sources of ineffectiveness have been identified in relation to cash flow hedges.

Hedged positions are measured at amortised cost. Hedging items are measured at fair value. If the hedging relationships are effective, changes in the fair value of hedging instruments are recognised in equity.

Once a quarter, the Bank analysed the sufficiency of the CHF mortgage loan portfolio in the context of pending court proceedings and the potential negative impact of court judgments on future cash flows in CHF. Based on the results of the analyses, in 2025 the Bank terminated two hedging relationships in CHF with the total nominal value of CHF 25m. Adjusted for provisions for legal risk raised in 2025, the CHF mortgage loan portfolio was sufficient to continue the hedging relationships. At the same time, given the ruling practice on CHF mortgage loans and the Bank’s assessment regarding future lawsuits, the Bank considers the possibility to terminate the relationships in the future periods.

The table below presents the distribution of nominal values of cash flow hedges by tenor as at 31 December 2025 and in the comparative period:

	Distribution of nominal values of cash flows
Nominal value of cash flow hedging instruments	up to 1 month	from 1 month to 3 months	from 3 months to 1 year	from 1 year to 5 years	over 5 years	Total
31.12.2025
Assets representing derivative hedging instruments	1 713 600	2 056 450	17 934 545	30 853 944	4 358 000	56 916 539
IRS	1 540 500	1 836 000	13 106 600	21 025 900	4 358 000	41 867 000
CIRS/OIS	-	-	4 649 370	8 685 869	-	13 335 239
CCIRS	173 100	220 450	178 575	1 142 175	-	1 714 300
Liabilities arising from derivative hedging instruments	1 767 450	2 047 335	17 982 920	30 889 619	4 358 000	57 045 324
IRS	1 540 500	1 836 000	13 106 600	21 025 900	4 358 000	41 867 000
CIRS/OIS	-	-	4 649 370	8 685 869	-	13 335 239
CCIRS	226 950	211 335	226 950	1 177 850	-	1 843 085
31.12.2024
Assets representing derivative hedging instruments	5 119 063	4 251 000	12 549 500	27 497 950	3 981 000	53 398 513
IRS	4 653 200	4 251 000	6 257 000	21 838 500	3 981 000	40 980 700
CIRS/OIS	-	-	5 341 250	4 913 950	-	10 255 200
CCIRS	465 863	-	951 250	745 500	-	2 162 613
Liabilities arising from derivative hedging instruments	5 265 709	4 251 000	12 671 545	27 646 665	3 981 000	53 815 919
IRS	4 653 200	4 251 000	6 257 000	21 838 500	3 981 000	40 980 700
CIRS/OIS	-	-	5 341 250	4 913 950	-	10 255 200
CCIRS	612 509	-	1 073 295	894 215	-	2 580 019

The table below presents pricing parameters of hedging instruments:

Pricing parameters for hedging instruments	up to 1 month	from 1 month to 3 months	from 3 months to 1 year	from 1 year to 5 years	over 5 years
31.12.2025
Assets representing derivative hedging instruments
Average fixed interest rate	5,0914	5,0878	4,4421	4,8255	4,9639
Average exchange rate (CHF/PLN)	4,5390	4,5390	4,5390	4,5390	4,5390
Average exchange rate (EUR/PLN)	4,2267	4,2267	4,2267	4,2267	4,2267
Average exchange rate (USD/PLN)	3,6016	3,6016	3,6016	3,6016	3,6016
Liabilities arising from derivative hedging instruments
Average fixed interest rate	-	3,2700	2,0789	2,0248	2,8400
Average exchange rate (CHF/PLN)	4,5390	4,5390	4,5390	4,5390	4,5390
Average exchange rate (EUR/PLN)	4,2267	4,2267	4,2267	4,2267	4,2267
Average exchange rate (USD/PLN)	3,6016	3,6016	3,6016	3,6016	3,6016
31.12.2024
Assets representing derivative hedging instruments
Average fixed interest rate	5,4889	5,3813	4,6195	5,0949	4,9847
Average exchange rate (CHF/PLN)	4,5371	4,5371	4,5371	4,5371	4,5371
Average exchange rate (EUR/PLN)	4,2730	4,2730	4,2730	4,2730	4,2730
Average exchange rate (USD/PLN)	4,1012	4,1012	4,1012	4,1012	4,1012
Liabilities arising from derivative hedging instruments
Average fixed interest rate	-	5,4327	1,5514	2,0422	2,8400
Average exchange rate (CHF/PLN)	4,5371	4,5371	4,5371	4,5371	4,5371
Average exchange rate (EUR/PLN)	4,2730	4,2730	4,2730	4,2730	4,2730
Average exchange rate (USD/PLN)	4,1012	4,1012	4,1012	4,1012	4,1012

The table below presents nominal values and carrying amounts of derivative hedging instruments designated as cash flow hedges as at 31 December 2025 and in the comparative period:

	31.12.2025			31.12.2024
Hedging instruments designed as cash flow hedges	Hedged item: Portfolio of floating interest rate loans in PLN and EUR	Hedged item: Portfolio of floating interest rate loans denominated in EUR and CHF	Hedged item: Issued bonds in EUR	Hedged item: Portfolio of floating interest rate loans in PLN and EUR	Hedged item: Portfolio of floating interest rate loans denominated in EUR and CHF
Nominal value of hedging instrument	55 202 239	778 710	1 064 375	51 235 900	2 580 019
Hedging derivatives - assets (carrying amount)	1 952 068	9 901	-	1 181 236	8 933
Hedging derivatives – liabilities (carrying amount)	5 216	128 290	27 631	90 117	414 845
Line item in the statement of financial position that includes the hedging instrument	Hedging derivatives (IRS, CIRS)	Hedging derivatives (CCIRS)	Hedging derivatives (CCIRS)	Hedging derivatives (IRS, CIRS)	Hedging derivatives (CCIRS)
Change in fair value of the hedging instrument used as the basis for recognising hedge ineffectiveness for the period	846 749	(1 987)	(17 636)	(598 399)	12 078
Balance of hedging gains or losses of the reporting period that were recognised in other comprehensive income	946 193	231	(17 636)	99 444	2 218
Value of hedge ineffectiveness recognised in profit or loss	-	(6 202)	-	-	10 643
Line item in the income statement that includes the recognised hedge ineffectiveness	Net trading income and revaluation	Net trading income and revaluation	Net trading income and revaluation	Net trading income and revaluation	Net trading income and revaluation
Hedged risk	Interest rate risk	Interest rate risk and currency risk	Interest rate risk and currency risk	Interest rate risk	Interest rate risk and currency risk
Period over which instruments have impact on the Bank’s results	up to 2035	up to 2027	up to 2030	up to 2034	up to 2027
Amount reclassified from the cash flow hedge reserve to profit or loss	(40 302)	55 236	(7 319)	(276 624)	85 421
Net trading income and revaluation	-	-	-	-	(421)
Net interest income	(40 302)	55 236	(7 319)	(276 624)	85 842
Line item in the income statement that includes the reclassification adjustment	-Net trading income and revaluation: Derivative instruments -Net interest income: Interest recorded on hedging IRS	-Net trading income and revaluation: Derivative instruments -Net interest income: Interest recorded on hedging IRS	-Net trading income and revaluation: Derivative instruments -Net interest income: Interest recorded on hedging IRS	-Net trading income and revaluation: Derivative instruments -Net interest income: Interest recorded on hedging IRS	-Net trading income and revaluation: Derivative instruments -Net interest income: Interest recorded on hedging IRS

The table below presents the change in value of the hedged item used as the basis for recognising hedge ineffectiveness, the balance of cash flow hedge reserve:

	31.12.2025			31.12.2024
Items subject to cash flow hedge accounting	Portfolio of floating interest rate loans in PLN and EUR	Portfolio of floating interest rate loans denominated in EUR and CHF	Issued bonds in EUR	Portfolio of floating interest rate loans in PLN and EUR	Portfolio of floating interest rate loans denominated in EUR and CHF
Change in value of the hedged item used as the basis for recognising hedge ineffectiveness for the period	846 749	(1 987)	(17 636)	( 598 399)	12 078
Balance of cash flow hedge reserve	946 193	231	(17 636)	99 444	2 218

Due to the sale of Santander Consumer Bank S.A. (SCB) in 2025, the tables below present data referring only to the comparative period as at 31 December 2024.

In the case of Santander Consumer Bank S.A. (SCB), there was one active FX SWAP transaction of CHF 20m at the end of 2024. The CIRS transaction that matured in 2024 has not been renewed.

In 2024, SCB made nine IRS transactions with a tenor of two to three years and the total nominal value of PLN 2.2bn. They are related to floating-rate loans as part of hedge accounting. The total value of the IRS portfolio is PLN 2.71bn.

Details of these transactions are presented in tables below:

	Distribution of nominal values of cash flows
Nominal value of hedging instruments	up to 1 month	from 1 month to 3 months	from 3 months to 1 year	from 1 year to 5 years	over 5 years	Total
31.12.2024
Assets representing derivative hedging instruments	92 276	-	460 000	2 250 000	-	2 802 276
FXSWAP	92 276	-	-	-	-	92 276
IRS	-	-	460 000	2 250 000	-	2 710 000
CCIRS	-	-	-	-	-	-
Liabilities arising from derivative hedging instruments	90 742	-	460 000	2 250 000	-	2 800 742
FXSWAP	90 742	-	-	-	-	90 742
IRS	-	-	460 000	2 250 000	-	2 710 000
CCIRS	-	-	-	-	-	-

Pricing parameters for hedging instruments	up to 1 month	from 1 month to 3 months	from 3 months to 1 year	from 1 year to 5 years	over 5 years
31.12.2024
Assets representing derivative hedging instruments
Average fixed interest rate	-	-	4,9100	5,0800	-
Average exchange rate (CHF/PLN)	4,5371	-	-	-	-
Average exchange rate (EUR/PLN)	4,2730	-	-	-	-
Liabilities arising from derivative hedging instruments
Average fixed interest rate	-	-	-	-	-
Average exchange rate (CHF/PLN)	-	-	-	-	-
Average exchange rate (EUR/PLN)	-	-	-	-	-

	31.12.2024
Hedging instruments designed as cash flow hedges	Hedged item: Portfolio of loans denominated in CHF	Hedged item: Portfolio of floating interest rate mortgage loans in PLN	Hedged item: Floating interest rate bonds	Hedged item: Portfolio of floating interest rate loans for subordinated entities
Nominal value of hedging instrument	90 742	375 000	10 000	2 325 000
Hedging derivatives – assets (carrying amount)	6 171	-	304	31 959
Hedging derivatives – liabilities (carrying amount)	-	3 026	-	4 641
Line item in the statement of financial position that includes the hedging instrument	Hedging derivatives (CIRS, FXSWAP)	Hedging derivatives (IRS)	Hedging derivatives (IRS)	Hedging derivatives (IRS)
Change in fair value of the hedging instrument used as the basis for recognising hedge ineffectiveness for the period	(84)	(564)	-	(1 338)
Balance of hedging gains or losses of the reporting period that were recognised in other comprehensive income	(75)	(1 603)	(91)	(9 855)
Value of hedge ineffectiveness recognised in profit or loss	(84)	(29)	-	(38)
Line item in the income statement that includes the recognised hedge ineffectiveness	Net trading income and revaluation	Net trading income and revaluation	Net trading income and revaluation	Net trading income and revaluation
Hedged risk	Currency risk	Interest rate risk	Interest rate risk	Interest rate risk
Period over which instruments have impact on the Bank’s results	up to 2025	up to 2027	up to 2025	up to 2027
Amount reclassified from the cash flow hedge reserve to profit or loss	-	-	1 388	-
Line item in the income statement that includes the reclassification adjustment	-	-	Interest income and similar to interest	-

	31.12.2024
Items subject to cash flow hedge accounting	Hedged item: Portfolio of loans denominated in CHF	Hedged item: Portfolio of floating interest rate mortgage loans in PLN	Hedged item: Floating interest rate bonds	Hedged item: Portfolio of floating interest rate loans for subordinated entities
Change in value of the hedged item used as the basis for recognising hedge ineffectiveness for the period	6 171	(3 026)	304	27 318
Balance of cash flow hedge reserve	-	-	-	-
Balance of foreign currency translation reserve for continuing hedges	-	-	-	-
Balance remaining in the cash flow hedge reserve for which hedge accounting is no longer applied	-	-	-	-
Balance remaining in the foreign currency translation reserve from any hedging relationships for which hedge accounting is no longer applied	-	-	-	-

Measurement to fair value of the hedging instrument, less deferred tax, is recognised in comprehensive income and accumulated in the Group’s equity during the period and are presented in note 41.

Impact of the IBOR reform

Santander Bank Polska Group uses cash flow hedges and fair value hedges that are affected by the interest rate benchmark reform (IBOR reform). The items hedged as part of hedge accounting include:

· variable-rate commercial and mortgage loans in PLN, EUR and CHF;

· fixed-rate debt securities in PLN;

· own issues in EUR.

As at 31 December 2025, there were 502 hedging relationships established at Santander Bank Polska S.A. The hedging instruments comprise IRS transactions for exposures in PLN (493 relationships connected with 493 IRS transactions), CCIRS – basis swaps for EUR/PLN and CHF/PLN rates with respect to exposures in EUR and CHF (7 relationships connected with 5 CCIRS transactions) and Cross Currency IRS transactions for EUR/PLN rates with respect to exposures in EUR (2 relationships connected with 2 CCIRS transactions).

The interest rate of the foregoing derivatives is based on the following variable rates: 1M, 3M or 6M WIBOR. The relationships are set to expire gradually by 2035:

101 relationships in 2026, 302 relationships over the next five years, and 99 relationships by 2035 (including 6 relationships in 2035 alone).

Detailed information about derivative and non-derivative financial instruments subject to the IBOR reform together with the summary of measures taken by the Bank to manage the risk arising from the reform and the accounting impact (including the impact on hedging relationships) is presented in Note 4 “Risk management” and in Note 43 “Hedge accounting” (section on derivative hedging instruments).

44. Sale and reverse sale and repurchase agreements

Santander Bank Polska Group raises funds by selling financial instruments under agreements to repurchase these instruments at future dates at a predetermined price.

Repo and sell-buy back transactions may cover securities from the Group’s balance sheet portfolio.

	31.12.2025	31.12.2024* restated	1.01.2024* restated
	Balance sheet value	Balance sheet value	Balance sheet value
Liabilities valued at amortised cost (contains sale and repurchase agreements)	2 580 543	1 198 455	273 547
Fair value of securities held as collateral for sale and repurchase agreements	2 575 358	1 198 845	271 933
Reverse sale and repurchase agreements	13 004 357	12 126 356	12 676 594
Fair value of securities held for reverse sale and repurchase agreements	12 942 916	11 961 417	13 056 880

*Data restated following changes to the presentation of cash and cash equivalents; details are presented in Note 2.5.

Reverse sale and repurchase agreements	31.12.2025	31.12.2024* restated	1.01.2024* restated
Reverse sale and repurchase agreements from banks	3 227 148	3 176 893	1 526 397
Reverse sale and repurchase agreements from customers	1 190 216	1 298 511	509 736
Total	4 417 364	4 475 404	2 036 133
Buy-sell-back transactions from banks presented as cash equivalents	8 586 993	7 650 952	10 640 461
Total buy-sell-back transactions	13 004 357	12 126 356	12 676 594

*Data restated following changes to the presentation of cash and cash equivalents; details are presented in Note 2.5.

Sale and repurchase agreements	31.12.2025	31.12.2024	1.01.2024
Sale and repurchase agreements from banks	7 311	151 908	108 975
Sale and repurchase agreements from customers	2 573 232	1 046 547	164 572
Total	2 580 543	1 198 455	273 547

Securities being the subject of repo and sale and repurchase agreements constituting the Group’s portfolio are not removed from the balance sheet, because the Group retains all rewards (i.e. interest income on pledged securities) and risks (interest rate risk and the issuer’s credit risk) attaching to these assets.

All of the above-mentioned risks and costs related to the holding of the underlying debt securities in the sale and repurchase agreements transactions remain with the Group, as well as power to dispose them.

The Group also acquires reverse repo and reverse sale and repurchase agreements financial instruments at the same price increased by the pre-determined amount of interest.

Financial instruments covered by reverse repo and reverse sale and repurchase agreements are not recognised in the balance sheet, because the Group does not retain any rewards or risks attaching to these assets.

Financial assets which are subject to reverse repo and reverse sale and repurchase agreements represent a security cover accepted by the Group which the Group may sell or pledge.

Financial instruments held as security for (reverse repo) repurchase agreements may be sold or repledged under standard agreements, under the obligation to return these to the counterparty on maturity date of the transaction.

45. Offsetting financial assets and financial liabilities

The Group enters into master agreements such as ISDA (International Swaps and Derivatives Association Master Agreements) and GMRA (Global Master Repurchase Agreement) providing for the possibility to terminate and settle the transaction with a counterparty in the event of default on the basis of a net amount of mutual receivables and payables.

In addition, under CSA (Credit Support Annex), the counterparty hedges derivative exposures with a deposit margin. The table presents fair value amounts of derivative instruments (both held for trading and designated as hedging instruments under hedge accounting) and cash collateral covered by master agreements providing for the right of set-off under specific circumstances. The value of instruments not subject to set-off are presented separately.

The Group offsets and presents net amounts of financial assets and financial liabilities in the statement of financial position if it has a legally enforceable right to offset the recognised amounts and intends either to settle on a net basis or to realise the asset and settle the liability simultaneously.

	Gross amounts before offsetting in the statement of financial position	Gross amounts set off in the statement of financial position	Net amount after offsetting in the statement of financial position	Amounts subject to master netting and similar arrangements not set off in the statement of financial position		Net amount of exposure	Amounts not subject to enforceable netting arrangements	Balance sheet total
				Financial instruments	Cash collateral received
Offsetting Financial Assets and Financial Liabilities on 31.12.2025	(a)	(b)	(c) = (a) ‒ (b)	(d)	(e)	(c) ‒ (d) ‒ (e)	(f)	(c) + (f)
Assets
Due from other banks
- Reverse sale and repurchase agreements with other banks	11 814 141	-	11 814 141	-	11 638 923	175 218	-	11 814 141
Loans and advances to customers
- Reverse sale and repurchase agreements	1 190 216	-	1 190 216	-	1 166 848	23 368	-	1 190 216
Other financial assets:
- Financial derivatives	20 841 172	8 076 806	12 764 366	9 489 987	2 569 431	704 948	234 000	12 998 366
Total assets subject to offsetting, master netting and similar arrangement	33 845 529	8 076 806	25 768 723	9 489 987	15 375 202	903 534	234 000	26 002 723
Liabilities							-
Financial derivatives	19 188 068	8 076 806	11 111 262	9 489 987	1 639 976	(18 701)	264 558	11 375 820
Sale and repurchase agreements	2 580 543	-	2 580 543	-	2 588 501	(7 958)	-	2 580 543
Total liabilities subject to offsetting, master netting and similar arrangement	21 768 611	8 076 806	13 691 805	9 489 987	4 228 477	(26 659)	264 558	13 956 363

	Gross amounts before offsetting in the statement of financial position	Gross amounts set off in the statement of financial position	Net amount after offsetting in the statement of financial position	Amounts subject to master netting and similar arrangements not set off in the statement of financial position		Net amount of exposure	Amounts not subject to enforceable netting arrangements	Balance sheet total
				Financial instruments	Cash collateral received
Offsetting Financial Assets and Financial Liabilities on 31.12.2024	(a)	(b)	(c) = (a) ‒ (b)	(d)	(e)	(c) ‒ (d) ‒ (e)	(f)	(c) + (f)
Assets
Due from other banks
- Reverse sale and repurchase agreements with other banks	10 827 845	-	10 827 845	-	10 717 256	110 589	-	10 827 845
Loans and advances to customers
- Reverse sale and repurchase agreements	1 298 511	-	1 298 511	-	1 266 409	32 102	-	1 298 511
Other financial assets:
- Financial derivatives	14 882 740	6 007 025	8 875 715	5 811 368	2 954 452	109 895	246 680	9 122 395
Total assets subject to offsetting, master netting and similar arrangement	27 009 096	6 007 025	21 002 071	5 811 368	14 938 117	252 586	246 680	21 248 751
Liabilities							-
Financial derivatives	14 342 836	6 007 025	8 335 811	5 811 368	3 249 631	(725 188)	477 849	8 813 660
Sale and repurchase agreements	1 198 455	-	1 198 455	-	1 177 162	21 293	-	1 198 455
Total liabilities subject to offsetting, master netting and similar arrangement	15 541 291	6 007 025	9 534 266	5 811 368	4 426 793	(703 895)	477 849	10 012 115

46. Fair value

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

Below is a summary of the book values and fair values of the individual groups of assets and liabilities not carried at fair value in the financial statements.

ASSETS	31.12.2025		31.12.2024-restated
ASSETS	Book Value	Fair Value	Book Value	Fair value
Cash and cash equivalents	30 504 739	30 504 739	29 003 506	29 003 506
Loans and advances to banks	2 371 648	2 371 648	4 031 165	4 031 165
Loans and advances to customers measured at amortised cost	148 904 495	149 946 469	155 594 869	155 660 490
-individuals	21 708 641	22 268 429	30 421 990	30 983 796
-housing loans	56 372 307	55 980 606	55 514 953	54 608 638
-business	68 969 898	69 843 785	67 522 275	67 932 405
Buy-sell-back transactions	4 417 364	4 417 364	4 475 404	4 475 404
Debt investment securities measured at amortised cost	49 689 035	50 859 509	35 596 997	35 404 456
LIABILITIES
Deposits from banks	2 847 280	2 847 280	5 148 660	5 148 660
Deposits from customers	230 142 564	230 141 945	232 028 762	232 014 242
Sell-buy-back transactions	2 580 543	2 580 543	1 198 455	1 198 455
Subordinated liabilities	1 601 965	1 579 481	2 228 898	2 214 232
Debt securities in issue	14 513 671	14 738 817	11 851 163	12 307 008

Below is a summary of the key methods and assumptions used in the estimation of fair values of the financial instruments shown in the table above.

Financial assets and liabilities not carried at fair value in the statement of financial position

The Group has financial instruments which in accordance with the IFRS are not carried at fair value in the consolidated financial statements. The fair value of such instruments is measured using the following methods and assumptions.

Loans and advances to banks: The fair value of deposits is measured using discounted cash flows at the current money market interest rates for receivables of similar credit risk, maturity and currency. In the case of demand deposits without a fixed maturity date or with maturity up to 6 months, it is assumed that their fair value is not significantly different than their book value. The process of fair value estimation for these instruments is not affected by the long-term nature of the business with depositors. Loans and advances to banks were classified in their entirety as Level 3 of the fair value hierarchy due to application of a measurement model with significant unobservable inputs.

Loans and advances to customers: Carried at net value after impairment charges. Fair value is calculated as the discounted value of the expected future cash flows in respect of principal and interest payments. It is assumed that loans and advances will be repaid at their contractual maturity date, excluding housing loans. Due to the long maturity of this product, a behavioral portfolio depreciation level was assumed in the fair value calculation. The estimated fair value of the loans and advances reflects changes in the credit risk from the moment of sanction (margins) and changes in interest rates. Loans and advances to customers were classified in their entirety as Level 3 of the fair value hierarchy due to application of a measurement model with significant unobservable inputs, i.e. current margins achieved on new credit transactions.

Debt investment financial assets measured at amortized cost: fair value estimated based on market quotations. Instruments classified in category I of the fair value hierarchy.

Deposits from banks and deposits from customers: Fair value of the deposits with maturity exceeding 6 months was estimated based on the cash flows discounted by the current market rates for the deposits with similar maturity dates. In the case of demand deposits without a fixed maturity date or with maturity up to 6 months, it is assumed that their fair value is not significantly different than their book value. The process of fair value estimation for these instruments is not affected by the long-term nature of the business with depositors. Deposits from banks and deposits from customers were classified in their entirety as Level 3 of the fair value hierarchy due to application of a measurement model with significant unobservable inputs.

Debt securities in issue and subordinated liabilities: The Group has made an assumption that fair value of those securities is based on discounted cash flows methods incorporating adequate interest rates. Debt securities in issue and subordinated liabilities were classified in their entirety as Level 3 of the fair value hierarchy due to application of a measurement model with significant unobservable inputs.

For Debt securities in issue and other items of liabilities, not carried at fair value in the financial statements, including: lease liabilities and other liabilities - the fair value does not differ significantly from the presented carrying amounts.

Financial assets and liabilities carried at fair value in the statement of financial position

As at 31.12.2025 and in the comparable periods the Group made the following classification of its financial instruments measured at fair value in the statement of financial position:

Level I (active market quotations): debt, equity and derivative financial instruments which at the balance sheet date were measured using the prices quoted in the active market. The Group allocates to this level fixed-rate State Treasury bonds, treasury bills, shares of listed companies and WIG 20 futures.

Level II (the measurement methods based on market-derived parameters): This level includes NBP bills and derivative instruments. Derivative instruments are measured using discounted cash flow models based on the discount curve derived from the inter-bank market.

Level III (measurement methods using material non-market parameters): This level includes equity securities that are not quoted in the active market, measured using the expert valuation model; investment certificates measured at the balance sheet date at the price announced by the mutual fund and debt securities. This level includes also part of credit cards portfolio and loans and advances subject to underwriting, i.e. portion of credit exposures that are planned to be sold before maturity for reasons other than increase in credit risk.

The objective of using a valuation technique is to determine the fair value, i.e., prices, which were obtained by the sale of an asset in an orderly transaction between market participants carried out under current market conditions between market participants at the measurement date.

Level 3: Other valuation techniques.

Financial assets and liabilities whose fair value is determined using valuation models for which input data is not based on observable market data (unobservable input data). In this category, the Group classifies financial instruments, which are valued using internal valuation models:

LEVEL 3	CARRING VALUE	VALUATION METHOD	UNOBSERVABLE INPUT
LOANS AND ADVANCES TO BANKS AND CUSTOMERS: underwriting loans and advances;	3 723 371	Discounted cash flow method	Effective margin on loans
CORPORATE DEBT SECURITIES	4 405 861	Discounted cash flow method	Credit spread
SHARES IN BIURO INFORMACJI KREDYTOWEJ SA	62 500	Estimation of the fair value based on the present value of the forecast results of the company	The valuation assumed a payment of 100% of the net result forecasted by the company and the discount estimated at market level.
SHARES IN KRAJOWA IZBA ROZLICZENIOWA SA	76 000	Estimation of the fair value based on the present value of the forecast results of the company	The valuation assumed a payment of 80% of the net result forecasted by the company and the discount estimated at market level.
SHARES IN POLSKI STANDARD PŁATNOŚCI SP. Z O.O.	343 000	Estimation of the fair value based on the present value of the forecast results of the company	The valuation based on the company's forecasted net financial results and revenues and the median P/E and EV/S multipliers based on the comparative group.
SHARES IN SOCIETY FOR WORLDWIDE INTERBANK FINANCIAL TELECOMMUNICATION	1 763	Estimation of the fair value based on the net assets value of the company and average FX exchange rate	The valuation was based on net assets of the company and the Bank's share in the capital (ca 0.048%).
SHARES IN SYSTEM OCHRONY BANKÓW KOMERCYJNYCH S.A.	136	Estimation of the fair value based on the net assets value of the company	The valuations were based on the companies' net assets and the Bank's share in capital at the level of: -for SOBK ca. 12.9% -for DCHRS ca. 1.3%. -for WSEZ ca. 0.2%.
SHARES IN DOLNOŚLĄSKIE CENTRUM HURTU ROLNO-SPOŻYWCZEGO S.A.	1 615
SHARES IN WAŁBRZYSKA SPECJALNA STREFA EKONOMICZNA „INVEST-PARK” SP Z O.O.	1 816

Expert valuations of capital instruments are prepared whenever required, but at least once a year. Valuations are prepared by an employee of the Department of Capital Management and Capital Investments (DZKiIK), and then verified by an employee of the Financial Risk Department (DRF) and finally accepted by a specially appointed team of Directors: Department of Capital Management and Capital Investments (DZKiIK), Financial Risk Department (DRF). ) and the Financial Accounting Area (ORF) (or employees designated by them). The valuation methodology for estimating the value of financial instruments from the DZKiIK portfolio using the expert method is included in the document "Investment strategy of Santander Bank Polska S.A. in capital market instruments. This document is subject to periodic reviews, updated at least once a year and approved by the Management Board and the Supervisory Board of the Bank.

Instruments are transferred between levels of the fair value hierarchy based on observability criteria verified at the ends of reporting periods. In the case of risk factors commonly considered observable on the market, the Bank considers information on directly concluded transactions on a given market to be the primary criterion of observability, and information on the number and quality of available price quotations is an auxiliary criterion.

In the period from January 1 to December 31, 2025, the following transfers of financial instruments between levels of the fair value measurement hierarchy were made:

• derivatives were transferred from Level 3 to Level 2, which on the date of conclusion, due to the original maturity date and liquidity, are classified at level 3, and for which, as their period to maturity shortens, the liquidity of observable quotations increases and are transferred to level 2;

The impact of estimated parameters on measurement of financial instruments for which the Bank applies fair value valuation according to Level 3 as at 31 December 2025 and in comparative period is as follows:

					Impact on fair value +/-100 bps
Fair value as at 31.12.2025	Valuation technique	Unobservable factor	Unobservable factor range	Positive scenario		Negative scenario

Corporate debt securities	4 405 861	Discounted cash flow	Credit spread	(0.25%-0.92%)	110 825	(106 210)
Loans and advances measured at fair value through other comprehensive income-customers	3 167 384	Discounted cash flow	Effective margin	(0,34%-2,74%)	135 334	(125 098)
Loans and advances measured at fair value through other comprehensive income-banks	555 987	Discounted cash flow	Effective margin	0,57%	40 948	(37 415)

						Impact on fair value +/-100 bps
	Fair value as at 31.12.2024	Valuation technique	Unobservable factor	Unobservable factor range	Positive scenario		Negative scenario
Corporate debt securities	9 648 274	Discounted cash flow	Credit spread	(0.03%-0.88%)	163 205		(156 328)
Loans and advances measured at fair value through other comprehensive income	4 289 996	Discounted cash flow	Effective margin	(2.21%-3.17%)	140 458		(130 663)

As at 31.12.2025 and in the comparable periods the Group classified its financial instruments to the following fair value levels:

31.12.2025	Level I	Level II	Level III	Total
Financial assets
Financial assets held for trading	4 299 395	10 965 611	13 605	15 278 611
Hedging derivatives	-	2 023 727	-	2 023 727
Loans and advances to customers measured at fair value through other comprehensive income	-	-	3 167 384	3 167 384
Loans and advances to banks measured at fair value through other comprehensive income	-	-	555 987	555 987
Debt securities measured at fair value through other comprehensive income	24 283 955	-	4 405 861	28 689 816
Debt securities measured at fair value through profit and loss	-	-	-	-
Equity securities measured at fair value through other comprehensive income	-	-	-	-
Equity securities measured at fair value through other comprehensive income	-	-	486 830	486 830
Assets pledged as collateral	2 575 358	-	-	2 575 358
Total	31 158 708	12 989 338	8 629 667	52 777 713
Financial liabilities
Financial liabilities held for trading	1 180 478	11 182 801	144	12 363 423
Hedging derivatives	-	192 875	-	192 875
Total	1 180 478	11 375 676	144	12 556 298

31.12.2024	Level I	Level II	Level III	Total
Financial assets
Financial assets held for trading	1 620 979	7 720 406	6 190	9 347 575
Hedging derivatives	-	1 401 753	-	1 401 753
Loans and advances to customers measured at fair value through other comprehensive income	-	-	4 289 996	4 289 996
Loans and advances to customers measured at fair value through profit and loss	-	-	63 289	63 289
Debt securities measured at fair value through other comprehensive income	25 199 577	-	9 648 274	34 847 851
Debt securities measured at fair value through profit and loss	-	-	1 247	1 247
Equity securities measured at fair value through profit and loss	-	-	8 619	8 619
Equity securities measured at fair value through other comprehensive income	-	-	462 317	462 317
Assets pledged as collateral	1 198 845	-	-	1 198 845
Total	28 019 401	9 122 159	14 479 932	51 621 492
Financial liabilities
Financial liabilities held for trading	1 703 764	8 204 852	1 071	9 909 687
Hedging derivatives	-	607 737	-	607 737
Total	1 703 764	8 812 589	1 071	10 517 424

The tables below show reconciliation of changes in the balance of financial instruments whose fair value is established by means of the valuation methods using material non-market parameters.

Level III
31.12.2025	Financial assets for trading	Loans and advances to customers measured at fair value through profit and loss	Loans and advances to customers measured at fair value through other comprehensive income	Loans and advances to banks at fair value through other comprehensive income	Debt securities measured at fair value through profit and loss	Debt securities measured at fair value through other comprehensive income	Equity securities measured at fair value through other comprehensive income	Equity securities measured at fair value through profit and loss	Financial liabilities held for trading
As at the beginning of the period	6 190	63 289	4 289 996	-	1 247	9 648 274	462 317	8 619	1 071
Profit or losses
-recognised in income statement	-								-
---net trading income and revaluation	8 913	2 975							(1 435)
---net interest income	-		228 854	7	-	188			-
---gains/losses from other financial securites	-					324 048	-		-
-recognised in equity (OCI)	-					-	24 513		-
Purchase/granting	4 361	645	889 883	555 980		-	-		534
Sale	(5 843)	(683)	(352 076)	-		-	-		-
Matured	-	(4 474)	(1 866 588)	-		(5 566 649)	-		-
Sale of SCB Group	-	(61 752)		-	(1 247)	-	-	(8 619)	-
Transfer	(16)	-	-	-	-	-	-		(26)
Other	-	-	(22 685)	-	-	-	-	-
As at the end of the period	13 605	-	3 167 384	555 987	-	4 405 861	486 830	-	144

Level III
31.12.2024	Financial assets for trading	Loans and advances to customers measured at fair value through profit and loss	Loans and advances to customers measured at fair value through other comprehensive income	Debt securities measured at fair value through profit and loss	Debt securities measured at fair value through other comprehensive income	Equity securities measured at fair value through other comprehensive income	Equity securities measured at fair value through profit and loss	Financial liabilities held for trading
As at the beginning of the period	9 498	85 093	2 798 234	2 005	11 555 157	277 121	5 840	5 944
Profit or losses
-recognised in income statement
---net trading income and revaluation	109	3 752		-	-	-		186
---net interest income			292 854
---gains/losses from other financial securites				(810)	-	-	1 462	-
-recognised in equity (OCI)				-	256 038	186 145	-	-
Purchase/granting	6 900	9 184	2 192 326	-	-	1 582	-	1 331
Sale	(4 626)	(930)	(203 096)	-	-	(2 531)	-	-
Matured	-	(33 810)	(778 653)	-	(2 162 921)	-	-	-
Transfer	(5 691)	-	-	-	-	-	-	(6 390)
Other	-	-	(11 669)	52	-	-	1 317	-
As at the end of the period	6 190	63 289	4 289 996	1 247	9 648 274	462 317	8 619	1 071

47. Legal risk connected with CHF mortgage loans

The term “Group” used in this note as at 31 December 2025 refers to the operations of Santander Bank Polska S.A. and its subsidiaries, excluding Santander Consumer Bank Group, which was sold in 2025. As at 31 December 2024, the “Group” referred to both Santander Bank Polska Group and Santander Consumer Bank Group.

As at 31 December 2025, the Group had a portfolio of 10.7k CHF-denominated and CHF-indexed loans of PLN 2,358,619k gross before adjustment to the gross carrying amount at PLN 2,350,380k reducing contractual cash flows in respect of legal risk. The Group also had PLN loans which used to be denominated in or indexed to CHF. Their total gross amount was PLN 283,348k before adjustment to the gross carrying amount at PLN 221,208k reducing contractual cash flows in respect of legal risk. There were 34.6k repaid CHF-denominated or CHF-indexed loans exposed to legal risk, and the disbursed amount totalled PLN 4.3bn.

As at 31 December 2024, the Group had a portfolio of 24.4k CHF-denominated and CHF-indexed loans of PLN 4,798,163k gross before adjustment to the gross carrying amount at PLN 4,399,400k reducing contractual cash flows in respect of legal risk. The Group also had PLN loans which used to be denominated in or indexed to CHF. Their total gross amount was PLN 375,534k before adjustment to the gross carrying amount at PLN 277,371k reducing contractual cash flows in respect of legal risk. There were 52.4k repaid CHF-denominated or CHF-indexed loans exposed to legal risk, and the disbursed amount totalled PLN 6.2bn.

For a long period of time, the ruling practice regarding loans indexed to or denominated in foreign currencies has not been uniform.

At present, however, the dominant judicial is the annulment of a loan agreement due to unfair clauses concerning loan indexation and application of an exchange rate from the bank’s FX table. Some courts issue judgments as a result of which the loan is converted to PLN: the unfair indexation mechanism is removed and the loan is treated as a PLN loan with an interest rate based on a rate relevant for CHF. Other courts adjudicate partly in favour of banks: only the application of an exchange rate based on the bank’s FX table is deemed to be unfair and is replaced by an objective indexation rate, i.e. an average NBP exchange rate or market exchange rate.

Still others decide on the removal of loan indexation, as a consequence of which the loan is treated as a PLN loan with an interest rate based on WIBOR. Judgments are also passed which declare loan agreements void due to unlawful terms. Those judgments are incidental and as such, in the Group’s view, have no significant impact on the assessment of legal risk of court cases regarding mortgage loans denominated in or indexed to CHF.

Lastly, there are still rulings which are entirely favourable to banks, where conversion clauses are not deemed to be unfair and the case against the bank is dismissed.

The above‑described divergence in judicial positions continues to exist, although judgments declaring loan agreements invalid remain predominant.

In 2024, the Supreme Court attempted to harmonise its case law. In its resolution of 25 April 2024 (case no. III CZP 25/22), the Supreme Court comprehensively assessed issues related to CHF loan cases, stating, that:

· an abusive provision relating to the determination of the exchange rate cannot be replaced by another method of determining that rate derived from statutory provisions or established practice; consequently, due to the impossibility of determining a binding foreign exchange rate in an indexed or denominated loan agreement, the agreement is not binding also in its remaining scope.

Subsequently, addressing issues related to the annulment of a loan agreement, the Supreme Court indicated that:

· following the invalidation of a loan agreement, each party is entitled to an independent claim for the restitution of undue performance (the so‑called theory of two conditions);

the limitation period for the bank’s claim for restitution of amounts disbursed under the loan commences on the day following the date on which the borrower challenged the binding nature of the contractual provisions;
there is no legal basis for either party to claim interest or any other remuneration for the use of its funds for the period from the performance of the undue payment until the debtor falls into delay with respect to its restitution.

Already in its earlier resolution of 2021 (case no. III CZP 6/21), the Supreme Court held that, where a contract is declared invalid, the parties are required to return to each other all performances rendered for their benefit, in accordance with the theory of two conditions, while at the same time indicating that there are legal instruments enabling the simultaneous settlement of reciprocal claims arising from unjust enrichment following the invalidation of the agreement, such as set‑off and the right of retention.

In this resolution, the Supreme Court also stated that the limitation period for the bank’s claim for restitution of unjust enrichment cannot commence before the agreement is deemed permanently ineffective, i.e. until the consumer makes an informed decision regarding the invalidity of the agreement. This position corresponded with the view expressed by the Court of Justice of the European Union (CJEU) with respect to the limitation period for a consumer’s claims for the reimbursement of instalments paid, according to which it would be unjustified to calculate the beginning of the limitation period from the date of each repayment, as the consumer might not at that time have been aware of the existence or nature of unfair contractual terms.

In its case law, the Court of Justice of the European Union consistently accords priority to the protection of consumer interests infringed by unfair contractual terms. It emphasises that the primary objective of Directive 93/13/EEC is to restore the balance between the parties by placing the consumer in the legal and factual position in which they would have been had the agreement been concluded without the unfair term, while at the same time ensuring the deterrent effect intended by the Directive against the use of unfair terms by traders. The CJEU considers the invalidation of a contract to be a measure of last resort, to be applied only after the court has informed the borrower of the consequences of such invalidation and obtained their consent. At the same time, the CJEU emphasizes that, in order to preserve the validity of a contract, the national court should apply all available measures, including examining the possibility of removing only those elements of contractual clauses deemed unfair, provided that this does not alter the substance of the contractual obligation. However, in domestic case law, the prevailing approach is to invalidate the agreement as a consequence of the removal of unfair contractual provisions.

In its judgment of 15 June 2023 in case C‑520/21, concerning the parties’ claims relating to settlement for non‑contractual use of another party’s capital following contract invalidation, the CJEU confirmed that national law is competent to determine the consequences of the invalidation of a contract. The reasoning of the judgment indicates that, in the CJEU’s view, bank claims exceeding the restitution of the loan principal are contrary to the objectives of Directive 93/13/EEC if they would lead to the bank obtaining a profit analogous to that which it intended to achieve through the performance of the contract, thereby eliminating the deterrent effect.

At the same time, the CJEU ruled that, under EU law, there are no obstacles preventing a consumer from claiming compensation from a bank exceeding the reimbursement of instalments paid. However, it stipulated that such a claim should be assessed in light of all the circumstances of the case, so as to ensure that any benefits obtained by the consumer as a result of the invalidation of the agreement do not exceed what is necessary to restore the legal and factual position in which the consumer would have been had the defective agreement not been

concluded, and do not constitute a disproportionate sanction for the trader, in accordance with the principle of proportionality. Several judgments of national courts have already been noted dismissing consumers’ claims for reimbursement of amounts exceeding the instalments paid to the bank.

In its order of 12 January 2024 in case C‑488/23, the CJEU endorsed the position presented in the above‑mentioned judgment and interpreted that ruling, stating that a bank may not claim compensation from a consumer in the form of judicial valorisation of the disbursed loan principal, but only the amount of the principal paid out together with statutory default interest from the date of the payment demand.

In its judgment of 7 December 2023 in case C‑140/22, the CJEU held that the assessment of the abusive nature of contractual clauses occurs by operation of law and that the national court is obliged to examine the contested provisions ex officio. It also emphasised that the exercise of consumer rights cannot be made conditional upon the consumer submitting a declaration before the court confirming awareness of the consequences of the invalidity of the agreement and consenting to its invalidation.

In its judgment of 14 December 2023 in case C‑28/22, the CJEU addressed the issue of the limitation period for the parties’ claims, but did not determine a specific starting date for the limitation period, indicating only that it cannot commence from the date of a final court judgment and that the starting date of the limitation period may not be less favourable for the consumer than for the bank.

In its judgment of 19 March 2025 in case C‑396/24, the CJEU held that national case law under which, following the invalidation of a loan agreement due to abusive clauses, a trader is entitled to claim from the consumer repayment of the entire nominal amount of the loan granted, irrespective of the amount of repayments made by the consumer under the agreement and irrespective of the outstanding balance, is incompatible with the provisions of Directive 93/13/EEC. In this respect, the CJEU’s position diverges from the Polish Supreme Court’s theory of two restitutions, which assumes the mutual restitution by each party of all performances rendered (without applying automatic netting of reciprocal performances up to the lower amount under the balance theory). Consequently, the adoption of the CJEU’s position by Polish courts may result in changes to the settlement principles applied in case law with respect to the claims of each party to an invalidated loan agreement.

In response to this position of the CJEU, the Regional Court in Warsaw submitted a further request for a preliminary ruling concerning the settlement of the parties following the invalidation of a contract, in particular the application of the balance theory. The case has been registered under reference number C‑510/25 and is awaiting the scheduling of a hearing.

As already indicated, in cases concerning indexed and denominated loans, divergent court rulings persist; however, due to the predominance of the line of case law leading to the invalidation of loan agreements, as at the date of preparation of these financial statements, the Group has, in its legal risk quantification model for the portfolio of indexed and denominated foreign currency loans, taken into account (in the form of an adjustment to the gross carrying amount of active exposures or provisions for inactive exposures) this judicial outcome scenario.

This model may be affected by further rulings of the CJEU in response to preliminary questions referred by Polish courts, as well as by the practice of domestic courts. The Group continuously monitors the state of judicial case law in foreign currency loan cases regarding the development and potential changes in judicial trends. Future changes to the model could also be influenced by potential legislative intervention aimed at restoring the balance between the parties following the removal of an abusive clause, in order to protect legal certainty from the mass invalidation of mortgage loan agreements or by the introduction of sector‑specific solutions enabling mass, amicable settlement of disputes with borrowers (legislative work is currently underway on a draft act intended, inter alia, to streamline court proceedings concerning mortgage loans denominated in and indexed to CHF, introduce solutions encouraging amicable dispute resolution, and facilitate the settlement of mutual claims arising from contract invalidity within a single set of proceedings).

In view of the above, the Group identified the risk that in the case of lawsuits which have already been filed or are predicted to be filed based on applicable models the scheduled cash flows from the portfolio of mortgage loans denominated in and indexed to foreign currencies might

not be fully recoverable and/or that a liability might arise, resulting in a future cash outflow. The Group recognises the impact of legal risk associated with foreign currency mortgage loans in line with the requirements arising from:

IFRS 9 Financial Instruments – in the case of active loans and

IAS 37 Provisions, Contingent Liabilities and Contingent Assets – in the case of loans repaid in full or if the gross carrying amount of an active loan is lower than the value of risk.

The adjustment to the gross carrying amount (in accordance with IFRS 9) and provisions (in accordance with IAS 37) were estimated taking into account a number of assumptions which significantly influence the estimate reflected in the Group’s financial statements.

As at 31 December 2025, there were 13,312 pending lawsuits against the Group over loans indexed to or denominated in a foreign currency, with the disputed amount totalling PLN 5,468,224k. Loans repaid as at the lawsuit date accounted for 23% of all lawsuits. The latter included one class action filed against Santander Bank Polska S.A. under the Class Action Act and relating to 197 CHF-indexed loans with the disputed amount of PLN 50,983k.

As at 31 December 2024, there were 21,537 pending lawsuits against the Group over loans indexed to or denominated in a foreign currency, with the disputed amount totalling PLN 7,730,883k. Loans repaid as at the lawsuit date accounted for 16% of all lawsuits. The latter included one class action filed against Santander Bank Polska S.A. under the Class Action Act and relating to 263 CHF-indexed loans with the disputed amount of PLN 50,983k.

As at 31 December 2025, the total cumulative impact of legal risk associated with foreign currency mortgage loans recognised in the Group’s balance sheet was PLN 4,766,293k, including:

IFRS 9 adjustment to the gross carrying amount at PLN 2,571,589k

IAS 37 provision at PLN 2,194,704k.

As at 31 December 2024, the total cumulative impact of legal risk associated with foreign currency mortgage loans recognised in the Group’s balance sheet was PLN 6,592,013k, including:

IFRS 9 adjustment to the gross carrying amount at PLN 4,676,771k (including PLN 3,722,362k in the case of Santander Bank Polska S.A. and PLN 954,409k in the case of Santander Consumer Bank S.A.)

IAS 37 provision at PLN 1,915,242k (including PLN 1,461,997k in the case of Santander Bank Polska S.A. and PLN 453,245k in the case of Santander Consumer Bank S.A.).

The tables below present the total cost of legal risk connected with mortgage loans recognised in the Group’s income statement and statement of financial position, including the cost of settlements discussed in detail in the section below.

Cost of legal risk connected with foreign currency mortgage loans	1.01.2025–31.12.2025	1.01.2024–31.12.2024**
Impact of legal risk associated with foreign currency mortgage loans recognised as adjustment to gross carrying amount	(50 659)	(899 387)
Impact of legal risk associated with foreign currency mortgage loans recognised as provision	(990 831)	(924 468)
Other costs*	(555 141)	(428 706)
Total cost of legal risk associated with foreign currency mortgage loans	(1 596 631)	(2 252 561)
Gain/loss on derecognition of financial instruments measured at amortised cost	(46 940)	(65 278)
including: settlements made	(47 213)	(69 220)
Total cost of legal risk associated with foreign currency mortgage loans and settlements made	(1 643 844)	(2 321 781)

* Other costs include but are not limited to the costs of court proceedings and costs of enforcement of court judgments.

** Data for 2024 have been restated and refer only to Santander Bank Polska Group.

	31.12.2025	31.12.2024*
Adjustment to gross carrying amount in respect of legal risk associated with foreign currency mortgage loans	2 571 589	4 676 771
Provision for legal risk associated with foreign currency mortgage loans	2 194 704	1 915 242
Total cumulative impact of legal risk associated with foreign currency mortgage loans	4 766 293	6 592 013

* As at 31 December 2024, the total cumulative impact of legal risk related to foreign currency mortgage loans included SCB Group.

As at 31 December 2025, the total adjustment to the gross carrying amount and provisions for legal risk and legal provisions (for legal claims and a collective portion) in respect of the CHF loan portfolio were PLN 4,680,348k and accounted for 177.2% of the gross value of the active CHF loan portfolio (before IFRS 9 adjustment to the gross carrying amount).

As at 31 December 2024, the total adjustment to the gross carrying amount and provisions for legal risk and legal provisions (for legal claims and a collective portion) accounted for 127.4% of the gross value of the active CHF loan portfolio (before IFRS 9 adjustment to the gross carrying amount).

The model for assessing legal risk of foreign currency loans which is used to estimate provisions for legal risk derives from statistical data and expert judgments based on observation of developments and trends that may have significant impact on the ruling practice and on the number of legal disputes and their resolution. Accordingly, the scenarios of different court judgments used in the model reflect all developments whose number and significance for risk assessment is relevant from the perspective of the portfolio. At the same time, in order to prevent the model from being overly susceptible to fluctuations caused by data variability in short periods of time, the likelihoods of those scenarios are taken into account when making any potential changes to the underlying parameters.

The change in the value of the provisions between January and December 2025 resulted from a review of the legal risks connected with foreign currency mortgage loans. As a consequence of the review, the level of expected settlements and the number of expected lawsuits regarding active and in particular repaid loans were taken into account. The expected costs of court‑ordered settlements arising from the invalidation of loan agreements were updated, together with the revised estimates of the expected volume and cost of potential settlements. In addition, the probabilities of possible litigation outcomes reflected in the model were recalibrated.

The Group used a statistical model to estimate the likelihood of claims being made by borrowers in relation to both active and repaid loans based on the existing lawsuits against the Group and the estimated growth in their number. The model assesses the so-called lifetime risk and is based on a range of behavioural characteristics related to the loan and the customer. The Group assumes that lawsuits have been or will be filed against the Group in relation to approx. 41% of active and repaid loans (36% in December 2024).These assumptions are highly sensitive to a number of external factors, including but not limited to the ruling practice of Polish courts, the level of publicity around individual rulings, measures taken by the mediating law firms and the cost of proceedings. Customers’ interest in proposed settlements is another important aspect affecting the estimates, as is the practice of Polish courts with regard to the enforcement of CJEU rulings.

The Group expects that most of the projected lawsuits will be filed by the end of 2027, and then the number of new claims will decrease as the legal environment will become more predictable and standardised.

In the Group’s opinion, the expected number of cases estimated based on the statistical model is characterised by uncertainty owing to such factors as: the duration of court proceedings and the growing costs related to the instigation and continuation of court proceedings.

For the purpose of calculating the costs of legal risk, the Group also estimated how likely it is that a specific number of lawsuits will be filed and what the possible end scenarios are in this respect. The Group also considered the protracted proceedings in some courts.

As at 31 December 2025, 6,156  final and non-appealable judgments were issued in cases against the Group (considering those passed after the CJEU judgment of 3 October 2019), of which 6,023 were unfavourable to the Group, and 133 were entirely or partially favourable to the Group (compared to 4,841 judgments as at 31 December 2024, including 4,649 unfavourable ones and 192 entirely or partially favourable).When assessing the likelihoods, the Group used the support of law firms and conducted thorough analysis of the ruling practice in cases concerning indexed and denominated loans.

As mentioned above, there is no uniform ruling practice concerning indexed and denominated loans. However, as the majority of judgments result in the invalidation of loan agreements, the Group considered, as one of possible court rulings resulting in a financial loss, the annulment of the entire loan agreement due to unfair clauses, with only the nominal of the capital to be reimbursed by the borrower.

Settlements

The Group actively encourages customers to make settlements. As part of the settlement, the loan is converted to PLN and a method is determined to settle the liabilities arising from the loan agreement. The settlement terms are individually negotiated with customers. Settlement proposals are made both to customers who have taken legal action and to customers who have not yet decided to file a lawsuit. It is reflected in the model which is currently used to calculate legal risk provisions, both in terms of the impact of proposed settlements on customers’ willingness to bring the case to court and with respect to the potential outcomes of court proceedings.

By 31 December 2025, the Group made 12,466 settlements (both pre-court and post-court).

The Group applies a settlement scenario which reflects the level of losses for future settlements. The scenario is based on acceptance levels and losses on loans as part of settlement proposals described above. The acceptance level of future settlements is affected by factors such as the interest rate of PLN loans, the CHF/PLN conversion rate, the development of the ruling practice and the duration of proceedings.

Sensitivity analysis

Due to high uncertainty around both individual assumptions and their total impact, the Group carried out the following sensitivity analysis of the estimated impact of legal risk by assessing the influence of variability of individual parameters on the level of that risk. The sensitivity analysis also includes the impact of an increase in the loss on settlement. The amount of loss accepted by the Group as part of the settlement affects the total value of the provision as it is one of the possible ways to terminate the agreement whether or not the customer has filed a lawsuit against the Group.

The estimates were prepared in the form of a univariate analysis of provision value sensitivity.

Taking into account the variability of the parameters outlined below, as at 31 December 2025 and in the comparative period the collective provision for legal risk is affected as follows:

Scenario (PLN m)	Change in the collective provision as at 31.12.2025	Change in the collective provision as at 31.12.2024
Doubling the expected number of new customers filing a lawsuit (active and non-active customers)	801	731
50% reduction in the expected number of new customers filing a lawsuit (active and non-active customers)	(445)	(484)
10% relative increase in the loss on settlement	10	22

For all the parameters, the variability range in the sensitivity analysis was estimated taking into account the existing market conditions. The adopted variability ranges may change depending on market developments, which may significantly affect the results of the sensitivity analysis.

Taking into account the variability of the parameters outlined below, the provision for individual legal claims as at 31 December 2025 and in the comparative period is affected as follows:

Scenario (PLN m)	Change in the individual provision as at 31.12.2025	Change in the individual provision as at 31.12.2024
1% absolute increase in the likelihood of losing the case	39	57
1% absolute decrease in the likelihood of losing the case	(39)	(57)
10% relative increase in the loss on settlement	49	59

The Group also estimated the average cost of cancelling a loan, depending on whether it has already been fully repaid or not. The assumptions made in the estimation may change depending on changes in the applicable legal system and the developing judicial practice. The results of the analysis are presented in the table below:

Scenario (PLN m)	31.12.2025	31.12.2024
Average loss resulting from the cancellation of 1000 active credits	286	249
Average loss resulting from the cancellation of 1000 loans repaid	77	63

48. Discontinued operations

Measures to sell Santander Consumer Bank S.A.

In relation to the agreement made by Banco Santander S.A. (Santander Group) and Erste Group Bank AG (Erste Group), as announced on 5 May 2025, regarding the sale of a 49% stake in Santander Bank Polska S.A. and a 50% stake in Santander Towarzystwo Funduszy Inwestycyjnych S.A. (Santander TFI), the operations of Banco Santander S.A. in Poland had to be reorganised. It involved a change to the ownership structure of Santander Consumer Bank S.A., which, together with its subsidiaries (SCB Group), was part of Santander Bank Polska Group.

On 12 May 2025, Santander Bank Polska S.A. announced the start of discussions with Banco Santander S.A. on the sale of Santander Consumer Bank S.A.

With the consent from the Management Board and Supervisory Board of Santander Bank Polska S.A., on 16 June 2025 the Bank signed a preliminary agreement with Spain-based Santander Consumer Finance S.A. on the sale of 3,120k shares in Santander Consumer Bank S.A. representing 60% of the share capital and voting power for the total price of PLN 3.105bn.

In view of the above, starting from the financial statements as at 30 June 2025, the assets and liabilities of Santander Consumer Bank S.A. and its subsidiaries were classified as a group of assets and liabilities held for sale and as discontinued operations.

In connection with SCB Group being classified as discontinued operations, the Group’s data in the consolidated income statement for the 12-month period ended 31 December 2024 have been restated accordingly, while the data in the consolidated statement of financial position as at 31 December 2024 have not been restated, as required by IFRS 5.

Conclusion of an agreement with Santander Consumer Finance S.A. on the sale of shares in Santander Consumer Bank S.A. held by the Bank

On 23 December 2025, the Bank signed a final agreement with Santander Consumer Finance S.A. to sell 3,120,000 shares in Santander Consumer Bank S.A. representing 60% of the share capital and voting power for the total price of PLN 3,105,000,000. The transaction was closed on the same day and the Bank has not been a SCB shareholder since then.

In relation to the sale of SCB shares, Santander Bank Polska S.A. calculated the tax deductible acquisition cost based on the share exchange: the nominal value of own shares issued at the time of acquisition was used as the acquisition cost for the purpose of determining the taxable income from the sale of SCB shares.

The income tax charge is allocated in the income statement to the discontinued operations because it is directly connected with the sale of shares in the entity classified as discontinued operations.

As at the date of sale (23 December 2025), the major classes of assets and liabilities related to the discontinued operations comprising Santander Consumer Bank S.A. and its subsidiaries (after elimination of intercompany transactions) were as follows:

as at:	23.12.2025
ASSETS
Cash and cash equivalents	495 556
Hedging derivatives	66 821
Loans and advances to banks and customers	21 465 332
Investment securities	7 058 980
Property, plant and equipment, intangible assets and right of use assets	368 886
Non-current assets classified as held for sale	603
Deferred tax assets	796 947
Other assets	417 232
Total assets	30 670 357
LIABILITIES
Deposits from banks	3 597 982
Deposits from customers	17 892 829
Subordinated liabilities	200 649
Debt securities in issue	2 696 782
Lease liabilities	40 218
Current income tax liabilities	84 389
Provisions for financial liabilities and guarantees granted	3 477
Other provisions	554 443
Other liabilities	692 926
Total liabilities	25 763 695
Net assets	4 906 662
Total sale price	3 105 000
Cash and cash equivalents – loss of control	(495 556)
Total	2 609 444

SCB Group met the requirements for presentation as discontinued operations. Accordingly, the results of those operations have been presented directly in the Group’s income statement as post-tax profit (taking into account non-controlling interests related to the discontinued operations).

Income and expenses related to intercompany transactions made between Santander Bank Polska S.A. and SCB Group and intercompany transactions within SCB Group have been eliminated in the consolidated financial statements.

The above eliminations have been made in the income statement of the discontinued operations.

A detailed analysis of results of the discontinued operations (after eliminations) is presented below:

Income statement of the discontinued operations

	for the period:	1.01.2025-23.12.2025	1.01.2024-31.12.2024
Interest and similar income		2 676 819	2 499 187
Interest income on financial assets measured at amortised cost		2 093 524	1 973 449
Interest income on assets measured at fair value through other comprehensive income		141 935	127 579
Income similar to interest on assets measured at fair value through profit or loss		9 178	13 764
Income similar to interest on finance lease		432 182	384 395
Interest expense		(936 140)	(896 384)
Net interest income		1 740 679	1 602 803
Fee and commission income		209 773	217 730
Fee and commission expense		(111 297)	(92 898)
Net fee and commission income		98 476	124 832
Dividend income		72	143
Net trading income and revaluation		(711)	(2 320)
Gain (loss) on other financial instruments		(1 136)	2 344
Gain (loss) on derecognition of financial instruments measured at amortised cost		328	(4 902)
Other operating income		98 711	70 974
Net expected credit loss allowances		(335 995)	(259 487)
Cost of legal risk connected with foreign currency mortgage loans		(427 641)	(848 769)
Operating expenses, of which:		(668 779)	(613 482)
- Staff, general and administrative expenses		(471 335)	(465 666)
- Depreciation of property, plant and equipment and amortisation of intangible assets		(67 279)	(70 802)
- Depreciation of right-of-use assets		(1 409)	(1 409)
- Other operating expenses		(128 756)	(75 605)
Tax on financial institutions		(43 277)	(40 574)
Profit (loss) before tax from discontinued operations		460 727	31 562
Corporate income tax		32 749	(127 091)
Net profit (loss) for the period from discontinued operations after tax		493 476	(95 529)
Gain on sale of the subsidiary after income tax		(261 745)	-
Net profit (loss) for the period from discontinued operations		231 731	(95 529)
of which:
- net profit (loss) from discontinued operations attributable to owners of the parent entity		15 900	(71 118)
- net profit (loss) from discontinued operations attributable to non-controlling interests		215 831	(24 411)
Earnings per share from discontinued operations
Basic earnings (loss) per share (PLN/share)		4,83	(0,93)
Diluted earnings (loss) per share (PLN/share)		4,83	(0,93)

Details of disposal of SCB Group

Income from the sale of SCB Group	3 105 000
Net assets of SCB Group as at the date of sale*	(4 906 663)
Assets of non-controlling shareholders	2 103 627
Goodwill	(23 540)
Reclassification from other comprehensive income	39 552
Gross profit on sale	317 975
Income tax	(579 721)
Net profit on sale	(261 745)
SCB Group results for 2025 (majority interests)	277 645
Profit for 2025 from discontinued operations attributable to owners of the parent entity	15 900

*Assets of the entire consolidated SCB Group including the profit/loss for 2025 until the date of sale.

Other comprehensive income from discontinued operations

for the period:	1.01.2025-23.12.2025	1.01.2024-31.12.2024
Items that can be subsequently reclassified to profit or loss:	100 399	(1 797)
Revaluation and sale of debt financial assets measured at fair value through other comprehensive income (gross)	105 080	9 861
Deferred tax	(27 490)	(1 874)
Revaluation of cash flow hedging instruments (gross)	30 883	(12 079)
Deferred tax	(8 074)	2 295
Items that cannot be subsequently reclassified to profit or loss:	(643)	1 339
Accrual for retirement bonuses – actuarial gains/losses (gross)	(611)	1 653
Deferred tax	(32)	(314)
Other net comprehensive income	99 756	(458)

Net cash flows from discontinued operations

for the period:	1.01.2025-23.12.2025	1.01.2024-31.12.2024
Total net cash flows	(269 284)	490 729
Cash flows from operating activities	(152 992)	700 860
Cash flows from investing activities	(2 105 864)	(628 525)
Cash flow from financing activities	1 989 572	418 394

49. Contingent liabilities and litigation and claims

Information about pending court and administrative proceedings

The term “Group” used in this note as at 31 December 2025 refers to the operations of Santander Bank Polska S.A. and its subsidiaries, excluding the SCB Group which was sold during 2025. As at 31 December 2024, the Group referred to both Santander Bank Polska Group and Santander Consumer Bank Group.

As at 31.12.2025 the value of all litigation amounts to PLN 11,094,966k. This amount includes PLN 3,972,837 k claimed by the Group, PLN 6,016,354 k in claims against the Group and PLN 105,036 k of the Group’s receivables due to bankruptcy or arrangement cases.

As at 31.12.2025 the amount of all court proceedings which had been completed amounted to PLN 1,823,644 k.

As at 31.12.2025 the provisions for instigated lawsuits recognised in accordance with IAS 37 totalled PLN 1,580,123k and the adjustment to gross carrying amount under IFRS 9 related to instigated lawsuits totalled PLN 2,321,952k. In 3,474 cases against Santander Bank Polska SA, where the claim value was high (equal or above PLN 500 k), the total value of provisions for legal claims recognised in accordance with IAS 37 and the adjustment to gross carrying amount under IFRS 9 related to legal claims was PLN 1,742,479 k.

As at 31.12.2024 the value of all litigation amounts to PLN 11,800,966k. This amount includes PLN 3,283,971 k claimed by the Group, PLN 8,406,881 k in claims against the Group and PLN 110,114 k of the Group’s receivables due to bankruptcy or arrangement cases.

As at 31.12.2024 the amount of all court proceedings which had been completed amounted to PLN 848,485 k.

As at 31.12.2024 the provisions for instigated lawsuits recognised in accordance with IAS 37 totalled PLN 1,631,423k and the adjustment to gross carrying amount under IFRS 9 related to instigated lawsuits totalled PLN 3,913,821k. In 3,804 cases against Santander Bank Polska SA, where the claim value was high (equal or above PLN 500 k), the total value of provisions for legal claims recognised in accordance with IAS 37 and the adjustment to gross carrying amount under IFRS 9 related to legal claims was PLN 1,871,052 k.

Administrative penalty proceedings by the Polish Financial Supervision Authority

On 22.11.2023, the Polish Financial Supervision Authority (KNF) started administrative proceedings against Santander Bank Polska S.A. that might result in a penalty being imposed on the Bank under Article 176i(1)(4) of the Act on trading in financial instruments. At this stage of the proceedings, the amount of the potential penalty cannot be estimated reliably.

Court cases over a free credit sanction

As at 31 December 2025, there were 2,967 pending lawsuits against the Bank over a free credit sanction, with the disputed amount totalling PLN 85,924k. The lawsuits are brought by customers or entities that have purchased customers’ debt and concern the compliance of consumer cash loan agreements with the Consumer Credit Act.

There are also several proceedings pending before the CJEU following from the requests for preliminary ruling from the Polish courts. They refer to such issues as the permissibility of interest calculation on the loan portion financing non-interest costs, lender’s information obligations, appropriateness of application of a free credit sanction for potential infringement of information obligations in the light of the EU proportionality rule.

On 13 February 2025, the CJEU issued a judgment in case C-472/23, addressing some of the issues mentioned above: contractual information on annual percentage rate of charge (APRC), banks’ information obligations in the case of amendment of charges connected with the performance of an agreement and proportionality of the sanction depriving the lender of its right to interest and charges in the case of infringement of an information obligation. While not ruling on the permissibility of interest calculation on the loan portion financing non-interest costs, the CJEU held that an APRC was calculated at the time the agreement was concluded, based on the assumption that the agreement in the wording applicable at that time would remain valid for the period agreed. It means that the bank does not violate its information obligations regarding the APRC even if contractual terms affecting the APRC are subsequently found to be unfair. The CJEU concluded that such practice did not violate any information obligations.In its judgment, the CJEU also outlined the rules for proper performance of information obligations by banks in the case of amending charges connected with the performance of an agreement and stated that the proportionality rule should be applied in relation to the sanction rendering the loan free of interest and charges and that sanctions should be effective and deterrent.

On 9 October 2025, the CJEU issued a judgment in case C-80/24 on assignment agreements. It held that consumers’ claims towards banks could generally be subject to assignment agreements and that national courts did not have to examine of their own motion the lawfulness of such agreements. The CJEU did not rule out the possibility for national courts to examine the validity of assignment agreements based on an objection raised. It only concluded that in the case of disputes between debt buyers and banks courts did not need to do it of their own motion. If the bank raises an objection, the court still needs to examine whether an assignment agreement has been lawfully concluded, in particular if it does not violate consumer’s interest or best practice.

The Group closely monitors the ruling practice in terms of the free credit sanction. At present, the vast majority of rulings are favourable to the Group.

Proceedings in respect of unauthorised payment transactions

These sector-wide proceedings were initiated against the Bank under the decision of the Office of Competition and Consumer Protection (UOKiK) dated 8 July 2022. They concern the alleged breach of the Polish Payment Services Act by the Bank as a result of:

1. failing to refund the amount of the unauthorised payment transaction (or restore the debited payment account to the state in which it would have been if the unauthorised payment transaction had not taken place) by the end of the business day following the day of receipt of the consumer’s report of the unauthorised payment transaction, even if there were no reasonable or duly documented grounds for suspecting consumer’s fraud and no such suspicion was reported to the law enforcement authorities in writing;

2. providing consumers, in response to their reports of unauthorised payment transactions, with information about the payment service provider’s verification of the correct use of a payment instrument based on personal security credentials, suggesting that the bank’s mere demonstration that the disputed payment transactions were correctly authenticated is evidence of authorisation of such transactions and exempts it from an obligation to refund the amount of the unauthorised transaction; and

3. providing consumers, in response to their reports of unauthorised payment transactions, with false information about the authorisation of the disputed transactions, at the same time presenting information indicating that the transactions resulted from consumers’ breach (either deliberate or resulting from gross negligence) of at least one of the obligations referred to in Article 42 of the Payment Services Act and in the agreement between the consumer and the bank, which made them liable for the disputed payment transactions.

The Bank has actively cooperated with the UOKiK and proposed ways to conclude the proceedings in accordance with Article 28 of the Competition and Consumer Protection Act. On 29 July 2025, the Bank received a proposal for a uniform commitment statement to which it responded on 1 September 2025. On 29 October 2025, a meeting was held between the banks subject to the proceedings and the UOKiK to discuss the scope and contents of the uniform commitment statement. The deadline for the conclusion of the proceedings, as indicated by the UOKiK, is 30 June 2026.

Off-balance sheet liabilities

The value of contingent liabilities and off-balance sheet transactions are presented below. The value of liabilities granted and provision for off-balance sheet liabilities are presented also presented by categories. The values of guarantees and letters of credit as set out in the table below represent the maximum possible loss that would be disclosed as at the balance sheet day if the customers did not meet any of their obligations towards third parties.

	31.12.2025
Contingent liabilities	Stage 1	Stage 2	Stage 3	Total
Liabilities granted and received	69 546 555	2 060 363	85 958	71 692 876
- financial	53 655 524	1 626 469	86 146	55 368 139
- credit lines	49 816 727	1 259 288	78 893	51 154 908
- credit cards debits	3 369 279	282 933	7 253	3 659 465
- import letters of credit	468 808	84 248	-	553 056
- term deposits with future commencement term	710	-	-	710
- guarantees	15 929 558	450 434	24 075	16 404 067
Provision for off-balance sheet liabilities	(38 527)	(16 540)	(24 263)	(79 330)
Liabilities received				89 369 278
- financial				7 566
- guarantees				89 361 712
Total	69 546 555	2 060 363	85 958	161 062 154

	31.12.2024
Contingent liabilities	Stage 1	Stage 2	Stage 3	Total
Liabilities granted and received	61 526 905	2 115 244	271 018	63 913 167
- financial	43 948 161	1 783 150	274 134	46 005 445
- credit lines	39 804 477	1 479 086	249 662	41 533 225
- credit cards debits	3 458 827	301 655	8 207	3 768 689
- import letters of credit	670 970	2 409	16 265	689 644
- term deposits with future commencement term	13 887	-	-	13 887
- guarantees	17 613 728	350 871	37 042	18 001 641
Provision for off-balance sheet liabilities	(34 984)	(18 777)	(40 158)	(93 919)
Liabilities received				58 381 401
- financial				189 847
- guarantees				58 191 554
Total	61 526 905	2 115 244	271 018	122 294 568

50. Assets and liabilities pledged as collateral

Assets pledged as collateral	31.12.2025	31.12.2024
Treasury bonds blocked for REPO transactions	2 575 358	1 198 845
Total	2 575 358	1 198 845

The Group holds financial instruments such as:

· financial assets held for trading of PLN 2,070,128 k (in 2024 PLN 1,198,845 k),

· debt securities measured at amoritsed cost of PLN 505,230 k (in 2024 respectively: PLN 0 k),

which represent collateral for liabilities under buy-sell-back transactions. The liabilities were presented in note 44 Sale and reverse sale and repurchase agreements.

Apart from assets that secure liabilities that are disclosed separately in the statement of financial position when the receiving party may sell or exchange the assets for other security, the Group additionally held the following collateral for liabilities that did not meet the criterion:

	31.12.2025	31.12.2024
Treasury bonds blocked with BFG	700 044	1 215 648
Treasury bonds blocked for loans from banks	111 526	159 993
Deposits in financial institutions as collateralised valuation of transactions	1 650 621	2 812 955
Total	2 462 191	4 188 596

Assets securing funds to cover the BGF are debt securities.

The deposit protection fund was last created by Santander Bank Polska S.A. in 2024. The Bank calculated it using 0.20% of the funds deposited in all accounts with the Bank, which served as the basis for calculating the obligatory reserve.

As at 31 December 2025, assets held as security totalled PLN 700,044k, including PLN 0 to cover funds guaranteed by the Bank Guarantee Fund (PLN 1,215,648 k and PLN 654,696 k as at 31 December 2024, respectively).

For ageements regarding financing receivd in the form of loans from banks, collateral is establised by blocking in KDPW debt securities measured at fair value through other comprehensive income in the amount of PLN 111,526 k (in 2024 - PLN 159,993 k).

In 2025, deposits opened with financial institutions to secure the value of transactions totalled PLN 1,650,621 k (in 2024 – PLN 2,812,955 k).

In 2025, the Group accepted PLN 2,388,701 k worth of deposits securing of derivative transactions (vs. PLN 3,463,722 k in 2024).

Other liabilities accepted as collateral are disclosed in note 33.

51. Information about leases

Lease related amounts recognized in the income statement	1.01.2025-31.12.2025	1.01.2024-31.12.2024* represented
Amortisation of right of use asset incl.:	(143 808)	(149 857)
- Land and buildings	(128 291)	(139 173)
- IT equipment	(33)	-
- Transportation means	(14 125)	(9 632)
- Other	(1 359)	(1 052)
Interest expenses due to lease liabilities	(20 308)	(19 356)
Short-term lease costs	(7 236)	(9 015)
Low-value assets lease costs	(1 226)	(1 237)
Costs of variable lease payments not included in the measurement of the lease liabilities	(148)	(506)
Non-tax deductible VAT - lease	(36 159)	(34 597)
Total	(208 885)	(214 568)

*Represented data presenting continued operations following the separation of the discontinued operations; details are presented in Note 48

Lease agreements where the Group acts as a lessee

Lease liabilities	31.12.2025	31.12.2024
Lease liabilities (gross)	415 137	392 850
Discount	(26 037)	(44 400)
Lease liabilities (net)	389 100	348 450
Lease liabilities gross by maturity:
Short-term	119 235	151 006
Long-term (over 1 year)	295 902	241 844
Total lease liabilities (gross)	415 137	392 850

.

Movements in lease liabilities	1.01.2025-31.12.2025	1.01.2024-31.12.2024
As at the beginning of the period	348 450	365 833
Additions from:	245 271	166 270
- adding a new contract	128 115	27 926
- interest on lease liabilities	19 665	22 031
- update of lease term	96 101	112 322
- other changes	1 390	3 991
Disposals from:	(204 621)	(183 653)
- payment due to lease liabilities	(135 859)	(159 606)
- interest repayment	(20 211)	(21 492)
- FX differences	(2 539)	(2 555)
- transfer to liabilities associated with assets classified as held for sale	(45 934)	-
- other changes	(78)	-
As at the end of the period	389 100	348 450

Lease agreements where the Group acts as a lessor

Santander Bank Polska Group conduct leasing activity through leasing companies which specialise in funding vehicles, means of transport for companies and individuals, as well as in the leasing of machinery, equipment and properties.

The items “Loans and advances to customers” contain the following amounts relating to the lease obligations:

Leases gross receivables - maturity	31.12.2025	31.12.2024
less than 1 year	4 684 298	5 265 682
1-2 years	3 581 364	5 609 276
2-3 years	2 287 502	3 427 893
3-4 years	1 151 165	1 827 722
4-5 years	426 895	744 695
over 5 years	119 354	199 040
Total	12 250 578	17 074 308

.

Present value of minimum lease payments - maturity	31.12.2025	31.12.2024
less than 1 year	4 518 060	4 979 776
1-2 years	3 226 082	4 957 430
2-3 years	1 931 247	2 934 766
3-4 years	911 260	1 515 479
4-5 years	318 605	600 040
over 5 years	84 228	157 680
Total	10 989 482	15 145 171

.

Reconciliation between the lease receivables and the present value of minimum lease payments	31.12.2025	31.12.2024
Lease gross receivables	12 250 578	17 074 308
Unearned finance income	(1 261 096)	(1 929 137)
Impairment of lease receivables	(223 637)	(317 044)
Present value of minimum lease payments, net	10 765 845	14 828 127

Operating leases

Future minimum lease fees due to irrecoverable operating lease	31.12.2025	31.12.2024
less than 1 year	77 100	51 901
1-2 years	60 417	70 339
2-3 years	18 580	23 913
3-4 years	3 926	7 827
4-5 years	1 204	556
Total	161 227	154 536

52. Related parties

The tables below present transactions with related parties. They are effected between associates and related entities. Transactions between Santander Bank Polska Group companies and its related entities are banking operations carried out on an arm’s length business as part of their ordinary business and mainly represent loans, bank accounts, deposits, guarantees and leases. Intercompany transactions effected within the Group by the Bank and its subsidiaries have been eliminated from the consolidated financial statements. In the case of internal Group transactions, a documentation is prepared in accordance with requirements of tax regulations for transfer pricing.

As at 31 December 2025, the immediate and ultimate parent of Santander Bank Polska S.A. was Banco Santander S.A., headquartered in Spain. As at the date of publication of these financial statements, the parent entity is Erste Group Bank AG headquartered in Austria. Details are presented in Note 57.

Transactions with associates	31.12.2025	31.12.2024
Assets	53	246
Loans and advances to customers	-	192
Other assets	53	54
Liabilities	29 241	61 537
Deposits from customers	29 191	61 369
Other liabilities	50	168
Income	116 126	95 723
Interest income	-	19
Fee and commission income	116 126	95 649
Other operating income	-	55
Expenses	1 184	2 346
Interest expense	1 184	2 346

Transactions with Santander Group	with the parent company		with other entities
Transactions with Santander Group	31.12.2025	31.12.2024* restated	31.12.2025	31.12.2024* restated
Assets	10 179 929	12 802 000	2 692	27 558
Cash and cash equivalents	1 151 580	2 804 630	1 799	27 530
Loans and advances to banks, incl:	-	3 875 795	-	-
Loans and advances	-	3 875 795	-	-
Financial assets held for trading	9 015 697	6 120 328	-	-
Loans and advances to customers	-	-	893	-
Other assets	12 652	1 247	-	28
Liabilities	9 651 699	6 681 100	317 548	566 159
Deposits from banks incl.:	919 042	1 940 053	12 871	323 803
Current accounts and advances	513 456	1 520 942	12 871	10 974
Loans from other banks	405 586	419 111	-	312 829
Financial liabilities held for trading	8 714 829	4 726 694	-	-
Deposits from customers	-	-	198 238	208 869
Lease liabilities	-	-	25	25
Debt securities in issue	(2 821)	-	-	-
Other liabilities	20 649	14 353	106 414	33 462
Contingent liabilities	6 245 688	7 786 034	23 435	31 543
Sanctioned:	1 163 389	1 324 770	8 006	11 754
financial	-	-	273	-
guarantees	1 163 389	1 324 770	7 733	11 754
Received:	5 082 299	6 461 264	15 429	19 789
guarantees	5 082 299	6 461 264	15 429	19 789
Derivatives’ nominal values	903 763 816	833 297 798	-	-
Cross-currency interest rate swap (CIRS) – purchased	17 222 597	16 797 304	-	-
Cross-currency interest rate swap (CIRS) – sold	17 219 808	16 240 282	-	-
Single-currency interest rate swap (IRS)	548 185 131	414 285 838	-	-
Forward rate agreement (FRA)	171 925 500	164 755 500	-	-
Options interest rate	4 493 978	5 750 809	-	-
FX swap – purchased amounts	67 023 962	100 598 746	-	-
FX swap – sold amounts	67 213 345	100 224 112	-	-
FX options -purchased CALL	1 462 456	1 942 881	-	-
FX options -purchased PUT	1 377 624	1 891 724	-	-
FX options -sold CALL	1 835 844	2 455 966	-	-
FX options -sold PUT	2 000 351	2 692 006	-	-
Spot-purchased	824 021	1 044 150	-	-
Spot-sold	823 454	1 043 786	-	-
Forward- purchased	1 083 155	1 777 106	-	-
Forward- sold	1 072 590	1 797 588	-	-

*Data restated following changes to the presentation of cash and cash equivalents; details are presented in Note 2.5.

Transactions with Santander Group	with the parent company		with other entities
Transactions with Santander Group	1.01.2025-31.12.2025	1.01.2024-31.12.2024	1.01.2025-31.12.2025	1.01.2024-31.12.2024
Income	135 686	1 496 886	3 961	9 848
Interest income	124 468	262 129	592	1 449
Fee and commission income	11 213	17 463	96	80
Other operating income	5	34	2 863	7 548
Net trading income and revaluation	-	1 217 260	410	771
Expenses	564 650	259 139	274 293	205 498
Interest expense	78 185	160 439	28 321	9 205
Fee and commission expense	32 062	30 788	530	605
Net trading income and revaluation	393 070	-	-	-
Operating expenses incl.:	61 333	67 912	245 442	195 688
Staff,Operating expenses and management costs	61 302	67 875	245 232	195 413
Other operating expenses	31	37	210	275

Santander Factoring Sp. z o.o. – risk participation agreements

In H2 2019, Santander Factoring Sp. z o.o. and Banco Santander signed risk participation agreements whereby Santander Factoring would be able to transfer credit risk onto Banco Santander headquartered in Madrid or Banco Santander Branch in Frankfurt. Banco Santander may participate in the risk through Unfunded Risk Participation (whereby it issues a guarantee) or Funded Risk Participation (whereby it provides financing and assumes the insolvency risk for the debtor of Santander Factoring Sp. z o.o.). Assumption of the debtor’s insolvency risk reduces the RWA ratio for the Company’s assets.

Santander Factoring Sp. z o.o. pays an agreed remuneration to Banco Santander, both for the guarantee issued and for the financing provided. In the case of Funded Risk Participation, interest on financing is calculated at the base rate (WIBOR/ EURIBOR/SOFR) increased by a margin set for the factoring agreement in question. In the case of Unfunded Risk Participation, the remuneration is calculated by multiplying the guaranteed amount (for a given month) and the margin.

As at 31 December 2025, the debt (principal and interest) of Santander Factoring Sp. z o.o. in respect of the loans granted by Banco Santander and its Branch in Frankfurt was PLN 406,872 k (principal and interest) and PLN 420,402 k as at 31 December 2024.

As at 31 December 2025, factoring receivables financed with the foregoing loans totalled PLN 406,872 k and PLN 409,643 k as at 31 December 2024. As the conditions for transferring financial assets have not been met, the receivables covered by the Funded Risk Participation Agreement are still recognised in the statement of financial position.

As at 31 December 2025, the amount of loans received was consistent with the value of factoring receivables financed from these funds.

The tranches are to be repaid in the period from January to April 2026. Repayment of the tranches is conditioned upon the repayment to Santander Factoring Sp. z o.o. of the factoring receivables financed from the funds granted. At the same time, Santander Factoring Sp. z o.o. cannot sell or pledge the factoring receivables financed with the funds provided by Banco Santander and its Branch in Frankfurt.

The table below compares the carrying amounts and fair values of liabilities towards Banco Santander and its Branch in Frankfurt as at 31 December 2025 and 31 December 2024 in respect of the loans granted to finance factoring receivables. Given the short maturities of financial assets and financial liabilities and the fact that credit risk is included in the carrying amount of the financial assets it is assumed that their fair value does not differ significantly from their carrying amount.

	Carrying amount	Fair value	Carrying amount	Fair value
	2025		2024
Loans from Banco Santander and Frankfurt Branch	406 872	406 872	420 402	420 402
Factoring receivables financed with the loans	406 872	406 872	409 643	409 643

As at 31 December 2025, Santander Factoring Sp. z o.o. held:

· PLN 406,872 k – assets secured with loans granted under the Funded Risk Participation Agreement signed with Banco Santander S.A. on 22 November 2019;

· PLN 2,586,946 k – assets secured with guarantees issued under the Unfunded Risk Participation Agreement signed with Banco Santander S.A. on 22 November 2019;

· PLN 273,184 k - assets secured with guarantees issued under Santander Bank Polska;

· PLN 291,743 k – assets secured with loans granted under funded risk participation agreements signed with third party banks;

· PLN 394,335 k – assets secured by guarantees granted under funded risk participation agreements signed with third party banks;

· PLN 715,433 k – assets secured by other guarantees granted by third party banks.

Transactions with Members of Management and Supervisory Boards

Remuneration of Santander Bank Polska Management Board Members, Supervisory Board Members and key management personnel Santander Bank Polska Group’s. Loans and advances granted to the key management personnel.

As at 31.12.2025 and 31.12.2024 members of the Management Board were bound by the non-compete agreements which remain in force after they step down from their function. If a Member of the Management Board is removed from their function or not appointed for another term, he/she is entitled to a once-off severance pay. The severance pay does not apply if the person accepts another function in the Bank.

Loans and advances have been sanctioned on regular terms and conditions.

Transactions with members of Management Board	Management Board Members		Key Management Personnel
and Key Management Personnel	1.01.2025-31.12.2025	1.01.2024-31.12.2024	1.01.2025-31.12.2025	1.01.2024-31.12.2024
Short-term employee benefits	18 363	19 525	77 374	76 563
Post-employment benefits	-	-	-	-
Long-term employee benefits	8 009	8 698	17 753	16 303
Paid termination benefits	-	-	961	1 376
Share-based payments*	9 401	9 090	12 169	15 549
Total	35 773	37 313	108 257	109 791

*Share-based payments for key management personnel: the amount of PLN 12,169 k includes PLN 5,262 k paid in the form of shares in 2025. The remaining portion will be paid in subsequent years in accordance with the Remuneration Policy of Santander Bank Polska Group.

	Management Board Members		Key Management Personnel
	31.12.2025	31.12.2024	31.12.2025	31.12.2024
Loans and advances made by the Bank to the Members of the Management Board/Key Management and to their relatives	189	2 697	15 098	14 770
Deposits from The Management Board/Key management and their relatives	15 127	12 565	20 523	19 703

The category of key management personnel includes the persons covered by the principles outlined in the “Santander Bank Polska Group Remuneration Policy” and in the justified cases – by the principles separately specified in the companies.

Santander Bank Polska Group applies the “Santander Bank Polska Group Remuneration Policy”. The Policy has been approved by the bank’s Management Board and Supervisory Board and is reviewed annually or each time significant organisational changes are made.

Persons holding key executive positions are paid variable remuneration once a year following the end of the reference period and release of the Bank’s results. Variable remuneration is awarded in accordance with bonus regulations and five-year Incentive Plan VII and is paid in cash and in the Bank’s shares. The remuneration paid in shares may not be lower than 50% of the total amount of variable remuneration. Payment of min. 40% of the variable remuneration specified above is conditional and deferred for the period of four or five years. During that period, it is paid in arrears in equal annual instalments depending on the employee’s individual performance in the analysed period.

In 2025, the total remuneration paid to the Supervisory Board Members of Santander Bank Polska totalled PLN 2,594 k (2,471 k in 2024). In 2025, members of the Supervisory Board of Santander Bank Polska S.A. received remuneration from the Bank's related entities in the amount of PLN 360 k (PLN 200 k in 2024).

53. Acquisitions and disposals of investments in subsidiaries and associate

Conclusion of an agreement with Santander Consumer Finance S.A. for the sale of shares held by the Bank in Santander Consumer Bank S.A.

On 23 December 2025, a final agreement was concluded with Santander Consumer Finance S.A. for the sale by the Bank to SCF of 3,120,000 shares in Santander Consumer Bank S.A., representing 60% of the share capital of SCB and 60% of the total number of votes, for a total sale price of PLN 3,105,000,000. The Transaction closed on 23 December 2025, and from that date the Bank is no longer a shareholder of Santander Consumer Bank S.A. Details in Note 48.

Liquidation of Santander Inwestycje sp. z o.o.

On 27 June 2025, the Extraordinary General Meeting of Santander Inwestycje Sp. z o.o. decided to start the liquidation of the company on 1 July 2025, appoint a liquidator and change the company’s name to SPV XX04062025 (effective as of its registration in the National Court Register).

54. Employee benefits

Staff benefits include the following categories:

· Short-term benefits (remuneration, social security contributions, paid leaves, profit distributions and bonuses and non-cash benefits, provided free of charge or subsidized). Value of short-term employee benefits are undiscounted,

· Post-employment benefits (retirement benefits and similar payments, life insurance or medical care provided after the term of employment).

Within these categories, the companies of the Santander Bank Polska Group create the following types of provisions:

Provisions for unused holidays

Liabilities related to unused holidays are stated in the expected amount (based on current salaries) without discounting.

Provisions for employee bonuses

Liabilities related to bonuses are stated in the amount of the probable payment without discounting.

Provisions for retirement allowances

Based on internal regulations in respect to remuneration, the employees of the Bank are entitled to defined benefits other than remuneration:

· retirement benefits,

· retirement pension.

The present value of such obligations is measured by an independent actuary using the projected unit credit method.

The amount of the retirement and pension benefits and death-in-service benefits is dependent on length of service and amount of remuneration received by the employee. The expected present value of the benefits is calculated, taking into account the financial discount rate and the probability of an individual get to the retirement age or die while working respectively. The financial discount rate is determined by reference to up-to-date market yields of government bonds. The probability of an individual get to the retirement age or die while working is determined using the multiple decrement model, taking into consideration the following risks: possibility of dismissal from service, risk of total disability to work and risk of death.

These defined benefit plans expose the Group to actuarial risk, such as:

· interest rate risk – the decrease in market yields on government bonds would increase the defined benefit plans obligations,

· remuneration risk – the increase in remuneration of the Bank’s employees would increase the defined benefit plans obligations,

· mobility risk – changes in the staff rotation ratio,

· longevity risk – the increase in life expectancy of the Bank’s employees would increase the defined benefit plans obligations.

The principal actuarial assumptions adopted by an independent actuary as at 31 December 2025 are as follows:

· the discount rate for future benefits at the level of 5.20% (5.60% as at 31 December 2024),

· the future salary growth rate at the level of 3.25% (4,70% as at 31 December 2024),

· the probable number of leaving employees calculated on the basis of historical data concerning personnel rotation in the Group,

· the mortality adopted in accordance with Life Expectancy Tables for men and women, published the Central Statistical Office, adequately adjusted on the basis of historical data of the Bank.

Reconciliation of the present value of defined benefit plans obligations

The following table presents a reconciliation from the opening balances to closing balances for the present value of defined benefit plans obligations.

	31.12.2025	31.12.2024
As at the beginning of the period	69 985	63 554
Current service cost	3 125	2 873
Past service cost	(2 854)	(1 664)
Interest expense	2 907	4 381
Actuarial (gains) and losses	(3 532)	841
Change due to disposal of discontinued operations	(5 903)	-
Balance at the end of the period	63 728	69 985

Sensivity analysis

The following tables presents how the impact on the defined benefits obligations would have increased (decreased) as a result of a change in the respective actuarial assumptions by one percentage point as at 31 December 2025. (in % and in PLN k).

Defined benefit plan obligations	1 percent increase		1 percent decrease
	in %	in PLN k	in %	in PLN k
Discount rate	(6.73%)	(4 290)	7.19%	4 389
Future salary growth rate	7.30%	4 389	6.89%	(4 650)

The following tables presents how the impact on the defined benefits obligations would have increased (decreased) as a result of a change in the respective actuarial assumptions by one percentage point as at 31 December 2024. (in % and in PLN k).

Defined benefit plan obligations	1 percent increase		1 percent decrease
	in %	in PLN k	in %	in PLN k
Discount rate	(6,82%)	(4 773)	7,31%	4 834
Future salary growth rate	7,34%	4 834	(6,91%)	(5 135)

Other staff-related provisions

These are provisions for the National Fund of Rehabilitation of the Disabled, redundancies, overtime and staff training. These liabilities are stated at the amounts of expected payment without discounting.

The balances of the respective provisions are shown in the table below:

Provisions	31.12.2025	31.12.2024
Provisions for unused holidays	48 342	52 245
Provisions for employee bonuses	342 763	368 949
Provisions for retirement allowances	63 728	69 985
Other staff-related provisions	45 039	47 682
Total	499 872	538 861

Detailed information on employee provisions have been presented in note 38.

55. Share based incentive scheme

Santander Bank Polska S.A. (“Bank”, “SAN PL”) established in 2022 Incentive Plan VII (“Plan”), which is addressed to the employees of the Bank and its subsidiaries who significantly contribute to growth in the value of the organisation. The purpose of the Plan is to motivate the participants to achieve business and qualitative goals in line with the Group’s long-term strategy and to provide an instrument that strengthens the employees’ relationship with the organisation and encourages them to act in its long-term interest.

The Plan obligatorily covers all employees of Santander Bank Polska Group designated as material risk takers (identified employees). The list of other key participants is defined by the Bank’s Management Board and approved by the Supervisory Board. Those employees can participate in the Plan on a voluntary basis.

The participants who satisfy the conditions stipulated in the Participation Agreement and the Resolution confirming the delivery of objectives will be entitled to an award which is variable remuneration in the form of the Bank’s shares classified as an equity-settled share-based payment transaction under IFRS 2 Share-based Payment. To that end, the Bank will buy back up to 2,331,000 shares from 1 January 2023 until 31 December 2033, i.e.:

a) not more than 207,000 shares of SAN PL with the maximum value of PLN 55.3m in 2023;

b) not more than 271,000 shares of SAN PL with the maximum value of PLN 72.4m in 2024;

c) not more than 326,000 shares of SAN PL with the maximum value of PLN 87.0m in 2025;

d) not more than 390,000 shares of SAN PL with the maximum value of PLN 104.1m in 2026;

e) not more than 826,000 shares of SAN PL with the maximum value of PLN 220.5m in 2027;

f) not more than 145,000 shares of SAN PL with the maximum value of PLN 38.7m in 2028;

g) not more than 47,000 shares of SAN PL with the maximum value of PLN 12.5m in 2029;

h) not more than 42,000 shares of SAN PL with the maximum value of PLN 11.2m in 2030;

i) not more than 35,000 shares of SAN PL with the maximum value of PLN 9.3m in 2031;

j) not more than 27,000 shares of SAN PL with the maximum value of PLN 7.2m in 2032;

k) not more than 15,000 shares of SAN PL with the maximum value of PLN 4.0m in 2033.

The Bank’s Management Board will buy back the shares to execute Incentive Plan based on the authorisation granted by the General Meeting in a separate resolution. If it is not possible to buy back the shares (e.g. illiquidity of the shares on the Warsaw Stock Exchange, share prices going beyond the thresholds defined by the General Meeting, lack of the General Meeting’s authorisation for the Management Board to buy back shares in a given year of Incentive Plan VII or lack of the General Meeting’s decision to create a capital reserve for share buyback in a given year) in the number corresponding to the value of the awards granted, SAN PL will reduce pro-rata the number of shares granted to the participant. The difference between the value of the awards granted and the value of the shares transferred by the Bank to the participants as part of the award will be paid out as a cash equivalent.

Below are the vesting conditions that must be met jointly in a given year:

1.Delivery of at least 50% of the profit after tax (PAT) target of SAN PL for a given year.

2.Delivery of at least 80% of the team business targets for a given year at the level of SAN PL, Division or unit; the performance against the target is calculated as the weighted average of performance against at least three business targets defined as part of the financial plan approved by the Supervisory Board for a given year for SAN PL, Division or unit where the participant works, in particular:

· PAT (profit after tax) of SAN PL Group (excluding Santander Consumer Bank S.A.);

· ROTE (return on tangible equity expressed as a percentage calculated in line with SAN PL reporting methodology);

· NPS (Net Promoter Score calculated in line with SAN PL reporting methodology);

· RORWA (return on risk weighted assets calculated in line with SAN PL reporting methodology);

· number of customers;

· number of digital customers.

3. The participant’s performance rating for a given year at the level not lower than 1.5 on the 0.5–3.5 rating scale.

In addition, at the request of the Bank’s Management Board, the Supervisory Board can decide to grant a retention award to a participant, if the following criteria are met:

1)the participant’s average annual individual performance rating is at least 2.0 on the 1–4 rating scale during the period of their participation in Incentive Plan VII;

2)the average annual weighted performance against the Bank’s targets in the years 2022–2026 is at least 80%, taking into account the following weights:

a. 40% for the average annual performance against the PAT target;

b. 40% for the average annual performance against the RORWA target;

c. 20% for the average annual performance against the ESG target.

The maximum number of own shares to be transferred to participants as the retention awards is 451,000.

On 15 April 2025, the Annual General Meeting of Santander Bank Polska S.A. authorised the Bank’s Management Board to buy back the Bank’s fully covered own shares in 2026.

The total amount that the Bank can spend on the buyback of own shares in 2026, including the cost of the buyback, is PLN 104,130k.

The Annual General Meeting set up the capital reserve for the repurchase of own shares.

For the purpose of the Plan, in 2025 Santander Bank Polska S.A. bought back 155,605 shares (of 326,000 shares eligible for buyback) with the value of PLN 82,365,105 (from PLN 87,042,000 worth of capital reserve allocated to the delivery in 2025).

The average buyback price per share in 2025 was PLN 527,46.

The Plan covers the period of five years (2022–2026). However, as the payment of variable remuneration is deferred, the share buyback and allocation will be completed by 2033.

Due to the exhaustion of the amount allocated for the purchase of the Bank's own shares in 2025, on March 13, 2025, the Bank's Management Board completed the purchase of the Bank's own shares in 2025 for Program participants for the award for 2024 and part of the award for 2022-2023 which were subject to deferral. At the same time, an order was issued to transfer the above-mentioned shares to the brokerage accounts of eligible program participants. After settling all instructions, the Bank has no treasury shares.

The table below presents information about the number of shares.

Number of shares	2025	2024
Opening balance*	80 489	96 109
Awarded for the year	159 052	175 530
Executed for the year	(119 953)	(130 803)
Executed deferrals**	(33 346)	(60 347)
Closing balance	86 602	80 489

*the opening balance is the deferred part of the number of shares for 2022,2023 and 2024 deferred to future periods. Additionally, the number of shares for 2024 was corrected to reflect actual payments that occurred in 2025. In the Annual Report published in 2025, the data for 2024 was a prediction.

** the item includes the number of deferred shares transferred in 2024 in the amount of 35,545 and in 2025 in the amount of 24,802. The data in the report for 2024 did not include the number of deferred shares transferred in 2024 (35,545).

In 2025, the total amount recognised in line with IFRS 2 in the Group’s equity was PLN 104 902k. The amount of PLN 104,902k was included in staff expenses for 2025. The latter comprises expenses incurred in 2025 and part of the costs attributable to subsequent years of the Incentive Plan as the award will be vested in stages. In 2025, PLN 82 367 k worth of shares were transferred to employees.

In 2024, the total amount recognised in line with IFRS 2 in the Group’s equity was PLN 100 192k. The amount of PLN 100 192 k was taken to staff expenses for 2024. The latter comprises expenses incurred in 2024 and part of the costs attributable to subsequent years of the Incentive Plan as the award will be vested in stages. In 2024, PLN 72 334 k worth of shares were transferred to employees in 2024.

56. Dividend per share

Management Board's recommendation re distribution of profit for 2024 and decision on Dividend Reserve created pursuant to resolution no. 6 of the Annual General Meeting of 22 March 2021.

On 19 March 2025, the Management Board of Santander Bank Polska S.A. issued a recommendation on the distribution of profit for 2024 and the Dividend Reserve created pursuant to resolution no. 6 of the Annual General Meeting of 22 March 2021 (“Resolution no. 6”). The recommendation was positively reviewed by the Bank’s Supervisory Board.

The Bank’s Management Board recommended that the profit of PLN 5,197,479,813.35 earned in 2024 be distributed as follows:

- PLN 3,897,631,915.40 – to be allocated to the dividend for shareholders;

- PLN 104,130,000.00 – to be allocated to the capital reserve;

- PLN 1,195,717,897.95 – to be kept undistributed.

The Management Board also recommended that PLN 840,886,574.78 out of the Dividend Reserve created pursuant to Resolution no. 6 be allocated to the dividend for shareholders.

According to the Management Board’s recommendation, the dividend payment from the profit earned in 2024 and from the dividend reserve (“Dividend”) was to cover 102,189,314 series A, B, C, D, E, F, G, H, I, J, K, L, M, N and O shares. The Dividend was to total PLN 4 738 518 490,18

(of which PLN 3,897,631,915.40 represented 74.99% of the net profit earned in 2024 and PLN 840,886,574.78 was the amount allocated from the Dividend Reserve).

When making its decision, the Management Board took into account the then-current macroeconomic environment as well as the recommendations and guidance of the Polish Financial Supervision Authority (“KNF”), including that outlined in the KNF’s letter of 13 March 2025, of which the Bank informed the market in its current report no. 12/2025 of 13 March 2025, as well as that outlined in the letter of 17 March 2025 confirming the possibility to pay a dividend from the Dividend Reserve, of which the Bank informed the market in its current report no. 13/2025 of 17 March 2025.

Adoption of resolution on dividend payment

The Bank’s General Meeting held on 15 April 2025 adopted a resolution on dividend payment.

The Dividend amount was PLN 46,37 per share.

The Dividend record date was 13 May 2025.

The Dividend was paid on 20 May 2025.

Individual recommendation of the Polish Financial Supervision Authority with regard to meeting the criteria for paying dividend from the net profit earned in 2024

On 13 March 2025, the Management Board of Santander Bank Polska S.A. received an individual recommendation from the Polish Financial Supervision Authority (“KNF”) regarding the dividend policy of commercial banks for 2025 (“Dividend Policy”), the supervisory review and evaluation process and the Bank’s reporting data.

Additionally, in view of the sound quality of the Bank’s loan portfolio measured as the share of NPLs in the total portfolio of receivables from the non-financial sector (including debt instruments), the Bank’s potential dividend payout ratio was set at 75%.

To ensure the stability of the Bank’s operations and its further growth, the KNF recommended that the Bank should limit the risk present in its operations by:

1) not distributing more than 75% of the profit earned from 1 January to 31 December 2024, with the proviso that the maximum payout should not be higher than the annual profit reduced by the profit for 2024 already allocated to own funds;

2) consulting upfront with the supervisory authority any other measures which could reduce the Bank’s own funds (in particular if they go beyond the scope of the ordinary business and operational activity), including the distribution of the profit retained in previous years or the buyback or redemption of own shares.

Information on a possible dividend payout in 2025 from the dividend reserve

On 17 March 2025, the Management Board of Santander Bank Polska S.A. was advised by the Polish Financial Supervision Authority (“KNF”) that it did not have any objections to the payout of the additional amount of PLN 840,886,574.78 from the dividend reserve created pursuant to resolution no. 6 of the Annual General Meeting of 22 March 2021 on profit distribution and creation of capital reserve (“Dividend Reserve”).

Consequently, in line with the KNF’s individual recommendation, the total amount available for distribution to the Bank’s shareholders in 2025 was PLN 4,738,518,490.18.

57. Events which occurred subsequently to the end of the reporting period

Notices from Erste Group Bank AG and from Banco Santander S.A.

Santander Bank Polska S.A. informed, that on 9 January 2026 it received:

· from the shareholder: Erste Group Bank AG a notice on the acquisition from Banco Santander, S.A. the shares representing 49% of the total number of votes in the Bank and

· from the shareholder: Banco Santander, S.A. a notice on the change of share in the total votes in the Bank.

Signatures of the persons representing the entity

Date	Name	Function	Signature
23.02.2026	Michał Gajewski	President	The original Polish document is signed with a qualified electronic signature
23.02.2026	Andrzej Burliga	Vice-President	The original Polish document is signed with a qualified electronic signature
23.02.2026	Lech Gałkowski	Vice-President	The original Polish document is signed with a qualified electronic signature
23.02.2026	Artur Głembocki	Vice-President	The original Polish document is signed with a qualified electronic signature
23.02.2026	Magdalena Proga-Stępień	Vice-President	The original Polish document is signed with a qualified electronic signature
23.02.2026	Maciej Reluga	Vice-President	The original Polish document is signed with a qualified electronic signature
23.02.2026	Wojciech Skalski	Member	The original Polish document is signed with a qualified electronic signature
23.02.2026	Dorota Strojkowska	Member	The original Polish document is signed with a qualified electronic signature
23.02.2026	Magdalena Szwarc-Bakuła	Member	The original Polish document is signed with a qualified electronic signature
Signature of a person who is responsible for maintaining the accounting records
Date	Name	Function	Signature
23.02.2026	Anna Żmuda	Financial Accounting Area Director	The original Polish document is signed with a qualified electronic signature

N

2.1 Statement of compliance

2.2 Basis of preparation of financial statements

2.3 New standards and interpretations or changes to existing standards or interpretations which can be applicable to Santander Bank Polska S.A. Group and are not yet effective and have not been early adopted

2.4 Standards and interpretations or changes to existing standards or interpretations which were applied for the first time in the accounting year 2025

2.5 Comparability with the results from the previous periods

2.6 Use of estimates

2.7 Judgements that may significantly affect the amounts recognized in the financial statements

2.8 Material accounting policy information

18. Cash and cash equivalents

Santander Bank Polska S.A.

31. Other assets

36. Provisions for financial liabilities and guarantees granted

49. Contingent liabilities and litigation and claims

50. Assets and liabilities pledged as collateral

Santander Factoring Sp. z o.o. – risk participation agreements

Date

Name

Function

Signature

Signature of a person who is responsible for maintaining the accounting records

Date

Name

Function

Signature